Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

Oral Answers to Questions — SCOTLAND

Police

Mr. Gallie: To ask the Secretary of State for Scotland when he next expects to meet the Convention of Scottish Local Authorities to discuss police manning levels in Scotland.

Mr. McMaster: To ask the Secretary of State for Scotland if he has any plans to allocate additional funds to improve the level of community policing in Scotland.

The Secretary of State for Scotland (Mr. Ian Lang): I have no plans to meet COSLA to discuss levels of police manpower, which are primarily the responsibility of individual police authorities. The allocation of resources to particular policing priorities is for the chief constable. I pay specific grant on all net expenditure by police authorities. Uniformed police strength has risen by 9 per cent. since 1979.

Mr. Gallie: Is my right hon. Friend aware that my police authority, Strathclyde regional council, consistently undermans the force by, on average, 200 policemen? In view of the Conservative party's manifesto pledge, when will my right hon. Friend make minimum police levels mandatory?

Mr. Lang: My hon. Friend is absolutely right to draw attention to the fact that the Strathclyde police are substantially below establishment. The authority could recruit 258 new officers and still be within establishment. My hon. Friend is right also to draw attention to the Government's commitment at the last election to take the earliest possible legislative opportunity to enforce statutory requirements to bring establishments up to full complement.

Mr. McMaster: It is clear from the Secretary of State's answer that he offers only apathy where we desperately need action. Is he aware that in Paisley, in the past five months alone, there have been six murders, 50 serious assaults, 27 incidents involving guns and 33 hold-ups involving knives? Why is it that, every time I write to the Scottish Office on that subject, the right hon. Gentleman dodges his responsibility for police funding and passes the buck to everyone else? When will he stop blaming other people and dodging the question and take action to get police back on the streets?

Mr. Lang: Not only do we now pay a higher proportion of specific grant than the last Labour Government, but we have increased spending in real terms on the police by 52 per cent. I urge the hon. Gentleman as a Member of Parliament from the Strathclyde region to urge that local authority to increase its police force to full establishment.

Mr. Wilson: Does the Secretary of State agree that it might not come amiss from those who were most energetic and slavish in advocating the poll tax to show a little humility in considering its consequences for local authorities? Will he give practical support to Strathclyde's efforts to civilianise many jobs, which would release police officers for the work that they should do? Will the right hon. Gentleman welcome the high-profile approach adopted by Strathclyde police during a recent weekend in Glasgow city centre? Does he recognise the widespread fear and concern that exist over the trebling of knife-carrying? Will he explain why I have had no response to my approaches to the previous Lord Advocate or the present one about the urgent need for legislative action to deal with this critical problem? When will we get action instead of fancy words?

Mr. Lang: I did not notice the hon. Gentleman supporting our proposal during the general election campaign to bring in legislation on knives. He need be in no doubt that we are determined to fight the increase in crime, especially crimes of violence and those involving offensive weapons. We shall strengthen the powers of the police as necessary.

Council House Sales

Mr. Knox: To ask the Secretary of State for Scotland how many council houses have been sold to sitting tenants in Scotland since May 1979.

The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton): Since 1979, some quarter of a million houses have been sold by public authorities in Scotland. Almost all were sold to sitting tenants, of which almost 178,000 were sold by local authorities.

Mr. Knox: What proportion of council house stock in Scotland has been sold? If the figure is still significantly different from that in England, what steps is my hon. Friend taking to increase sales in Scotland?

Lord James Douglas-Hamilton: About 24 per cent. of the total stock in Scotland has been sold. Some years ago England was 5 per cent. ahead, but now it is barely 1 per cent. ahead. We are speedily closing the gap and intend to introduce further legislation to speed up rent-to-mortgage sales and right-to-buy sales and to bring in further rights for Scottish council tenants.

Dr. Godman: Is the Minister aware that many council house tenants in Inverclyde are deterred from buying their homes because of the appalling physical condition of the houses in which they live? Dampness is a major problem for many of my constituents and Inverclyde district council desperately needs help from the Scottish Office. When will the Minister provide the council with help so that the living conditions of my constituents can be improved to a level at which they might consider buying their houses?

Lord James Douglas-Hamilton: Allocations are made entirely on the basis of need. We shall introduce an effective right to repair for smaller repairs for council tenants and generally extend their present rights. I have visited the hon. Gentleman's constituency and I shall bear in mind his arguments before we next make allocations.

Sir Nicholas Fairbairn: Does my hon. Friend—[HON. MEMBERS: "Reading."]—comprehend the hypocrisy of the Labour party—

Hon. Members: Reading.

Madam Speaker: Order. All this takes time. Scottish Members will be complaining at the end of Question Time that they have not had long enough. Sir Nicholas Fairbairn.

Sir Nicholas Fairbairn: Does my hon. Friend understand the hypocrisy of the Labour party, which constantly and ceaselessly complains about homelessness but which paid the most expensive architect to erect the tower blocks at Royston Hill? After discovering that nobody wanted to live in them, it blew them up, at even more cost to the public purse, leaving the public to live in one cardboard box and the taxpayer to put his cheque in the other.

Lord James Douglas-Hamilton: My hon. and learned Friend makes an important point. We have learnt a great deal and the type of tower block of which he speaks would not be built now. I strongly recommend that Glasgow district council bring in the private sector more, to assist it in dealing with empty housing, enabling public sector resources to go much further.

Bypasses

Mr. Foulkes: To ask the Secretary of State for Scotland what recent representations he has received regarding bypass construction on Scottish roads.

Lord James Douglas-Hamilton: I have received representations from the hon. Member on bypass schemes in his constituency and was pleased that he was able to attend the opening of the A76 Cumnock and Auchinleck bypass last year. The Government have a steady programme of bypass construction and in addition have set out a number of ways in which safety and environmental improvements could be achieved in towns and villages, including traffic-calming schemes.

Mr. Foulkes: Yes, but does the Minister remember the letter that he sent to me on 15 May 1989, in which were set out scheme-ready dates for the Mauchline, New Cumnock, Maybole and Girvan bypasses of 1990, 1992, and 1993? Now the hon. Gentleman tells me that work will not start for at least five years on any of them. Will he think again about the priorities? He is syphoning money from those bypasses. I urge the hon. Gentleman to think again before communities are destroyed by the heavy lorries which come through the areas in which they live and to get the bypasses constructed. Otherwise I shall never be able to trust his word again.

Lord James Douglas-Hamilton: The hon. Gentleman must appreciate that our strategy is to provide the bypasses that are most needed. The commitment to which he referred had to be reviewed in the light of available

recources and the most pressing priorities in Scotland: the upgrading of the A74 to motorway status, the completion of the central Scotland motorway network, great improvements and full bypasses on the A96—which are going ahead—and great improvements to the A75, not to mention far-reaching proposals for the A1. We are spending 10 per cent. more on roads this year; the expenditure on roads and bridges will be about £222 million. We believe in short-term measures as well to assist the hon. Gentleman and his constituents, including traffic-calming measures and village gateways to stop excessive congestion and speeding through villages in the constituency.

Steel Sites

Dr. Bray: To ask the Secretary of State for Scotland what plans he has for the reclamation and redevelopment of steel sites in Scotland.

The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): Discussions continue between British Steel, Scottish Enterprise, Lanarkshire development agency and Motherwell district council on the steel sites in Scotland which remain in British Steel ownership, concerning the contribution that British Steel will make to the reclamation and redevelopment of these sites.

Dr. Bray: Is the Minister aware that Ravenscraig cast its last slab of steel this morning and that steel making has now ceased in Scotland? Does he accept that, to the end, Ravenscraig workers and the community that sustained them demonstrated the skills and responsibilities needed in a modern industry? Will he therefore accelerate the reclamation and redevelopment of the steel sites in Scotland so that Motherwell, and the people who have produced steel for generations, are able to continue to make a formidable contribution to the wealth of the nation in the future, as they have done in the past?

Mr. Stewart: I associate myself wholly with the sentiments expressed to the House by the hon. Gentleman regarding the steel workers of Ravenscraig and the communities that support them. As for his question about future work being done on the steel sites, I am encouraged by the agreement between British Steel and Scottish Enterprise on 15 April jointly to examine the best future use of the sites. The hon. Gentleman will, I think, know that the independent environmental audit that was recently commissioned by British Steel to examine the Ravenscraig site should help to identify the environmental issues better and to form an informed judgment on the way forward. I look forward to discussing later today the more detailed matters with the hon. Gentleman, the hon. Member for Motherwell, North (Dr. Reid) and Motherwell district council.

Mr. Devlin: On behalf of the steel-making constituencies of Teesside, may I point out to my hon. Friend that when a steel plant closes and a massive slimming exercise takes place, as has happened in our part of the world, where 56,000 people lost their jobs during the early 1980s, it does not necessarily mean that that is the end of the road for the communities concerned? The work of British Steel Industries and other support agencies that came into the area— [Interruption.]

Madam Speaker: Order. I must ask the hon. Gentleman not to make a speech to the House but to ask his question.

Mr. Devlin: Cannot other agencies that come in on the back of a steel closure of this magnitude lay the foundations for a very successful thriving economy for an area such as Motherwell in times to come?

Mr. Stewart: My hon. Friend makes an extremely valid point. It is now necessary for everyone to look forward to the future in Lanarkshire. I believe that that is what people are doing. We have poured in massive sums of public money. We have the enterprise zone. We have put in place a range of measures. Today, my right hon. Friend the Secretary of State for Scotland is approving £9.7 million expenditure by the Lanarkshire development agency for the development of phase I of the freight village at Mossend. About 1,600 jobs will result from phase I and the terminal there. The enterprise zone will result in 17,000 jobs, gross. We must, therefore, look to the future. That is what the Government are doing. That is what I believe the overwhelming majority of the people of Lanarkshire want to happen.

Dr. Reid: On the day when the last slab was cast in Motherwell after 112 years of steel making, may I pay my tribute to the steel workers and their families and say to the Minister that if his Government had shown half the dedication and commitment to the steel workers of Lanarkshire that the steel workers have shown to the industry, they would not be out of work today. Since the Minister and the Government have done damn all to save steel making in Motherwell over the past few years, will he at least give a pledge today that the Government will hold British Steel to its responsibility to provide finance for the reclamation of those steel sites? I want a concrete pledge today, because British Steel has produced nothing but pain in the past and has given us a present that is berefit of hope. It must not be allowed to destroy the future of Lanarkshire in the way that it has destroyed over the past 10 years.

Mr. Stewart: I reject the hon. Gentleman's allegation about the Government. I note that he did not mention the fact that when the Government came to office, British Steel was losing £1.86 billion a year, or about £5 million a day. That could not possibly continue. We must now look to the future. I pay tribute to the efforts of the steel workers. The Government are backing their commitment with real resources. I hope that members of the Labour party, who, I presume, want an improvement in the economy of Lanarkshire and more jobs in Lanarkshire, do not fall into the trap of talking down the area's prosperity.

Mr. Dewar: In the circumstances, I am a little surprised that the Secretary of State did not answer the question himself. I must say to the Minister that it seems to me that sympathy and tributes are not difficult to give, but we want a commitment that there will be a matching effort by the Government not only in the initial stages of the crisis facing the Lanarkshire economy but sustained over a considerable period so that a future can be built. Does the Minister accept that it is essential that British Steel take full responsibility for dealing with the legacy of dereliction and contamination that it is leaving behind? If British Steel does not accept that full responsibility, will the Minister take legal powers that will allow him to insist that in this case the polluter really pays?

Mr. Stewart: We have not just paid tributes to the steel workers of Lanarkshire. The hon. Gentleman criticises the Government, but he never answers the question; what would the Labour party have done if it had been in power? It would have done nothing that the Government have not done. Our commitment has been matched by funds, for the medium and long term certainly. I am discussing the details of reclamation and clearance with hon. Members, and the hon. Gentleman will know the legal framework within which the Government will have to operate.

NHS Trusts

Dr. Strang: To ask the Secretary of State for Scotland what plans he has to alter the regulations governing hospital trusts; and if he will make a statement.

Mr. Allan Stewart: The activities of NHS trusts in Scotland are monitored by the management executive of the national health service and, through contracts, by health boards purchasing the trust services. Should the interests of patient care require alteration of the regulations, the Government will do that. For the moment, we have no such plans.

Dr. Strang: Is there not a real danger that individual hospital trusts will undermine strategic planning by health boards? Could not a situation arise in Lothian whereby the health board will provide orthopaedic facilities in the new major hospital to be built just outside Edinburgh, but when that hospital comes into service the Princess Margaret Rose, which has become a trust, will continue to provide the same service, especially as many of its customers might well be GP fund holders and customers from outwith the health board's area?

Mr. Stewart: My right hon. Friend the Secretary of State and my right hon. and noble Friend the Minister of State have made it clear again and again that the services provided by the trusts will be determined by the contract entered into by the health boards. On the exceedingly rare occasions when a trust and a health board could disagree on the nature of services to be provided—the thought which is at the back of the hon. Gentleman's question—I confirm that my right hon. Friend the Secretary of State has the power of direction.

Mr. Dickens: Why does my hon. Friend think that the Scottish nation should be denied the excellence of national health service trust hospitals? After all, in England are they not a great success, treating many more patients than ever before—in fact, 6 per cent. more? That is patient care, and it is coming to Scotland. That is the beauty of the Union of the United Kingdom.

Mr. Stewart: I am happy to reassure my hon. Friend that the undoubted benefits of hospital trusts, to which he rightly refers, are of course coming to Scotland. There have been 18 expressions of interest, and my hon. Friend will be interested to know that among those expressing interest are the West Lothian unit in Livingston and Monklands district general hospital.

Mr. Watson: The Minister will know that one of those 18 expressions of interest came from the Victoria infirmary in my constituency, which also serves part of his constituency. Will he give a commitment that, before considering whether to allow the opt-out, he will consult


the people who use the hospital, and the community as a whole? Will he take on board their views or will he, as I suspect, deny them a say, just as he is denying the people of Scotland a say in their constitutional future through a referendum? He is doing that because he knows what the outcome would be—it would show that he was totally out of step with the people of Scotland and has no right or legitimacy to speak on their behalf.

Mr. Stewart: I must tell the hon. Gentleman that I do not accept the views of Scotland United on such matters. In answer to his other question, we have made it clear several times that we do not see ballots, either within the hospital concerned or in the broader locality, as a basis for determining trust status. The public consultation phase lasts three months and provides ample opportunity for the views of staff and public to be known. The hon. Gentleman referred specifically to the Victoria infirmary and may be interested to know that I saw four consultants last Saturday morning—[Interruption.] I must inform hon. Members that I hold constituency surgeries on Saturday mornings. I saw the four consultants because they are constituents of mine and had points to put to me.

Governance

Mr. Welsh: To ask the Secretary of State for Scotland if he will list those organisations which he had met as part of the Prime Minster's taking stock exercise in relation to the government of Scotland; and when he expects to come forward with proposals.

Mr. Galloway: To ask the Secretary of State for Scotland what further stock he has taken on the future governance of Scotland; and if he will make a statement.

Mr. Lang: We are continuing our consideration of arrangements for the governance of Scotland and will report back to the House in due course.

Mr. Welsh: Is not it true that the Government have no new ideas or proposals and are not willing to put the constitutional issue to the voters of Scotland? If private industry took as long over stocktaking as the Prime Minister does, it would end up bankrupt. Is not "taking stock" a cynical exercise in doing nothing at all?

Mr. Lang: No, it is not. After 13 years in office, the Government are bubbling over with new ideas in all areas of policy, as the hon. Gentleman will see if he reads our general election manifesto. The Government are indeed taking stock and we shall present our proposals, which I am sure will interest the hon. Gentleman, when they are ready.

Mr. Galloway: Having padlocked our steel industry today and having already murdered our coal and shipbuilding industries and decimated our engineering industry, the Government do not even have the guts to face the people of Scotland in a democratic test at the ballot box—a referendum. Why are the people of Denmark and France to be given a democratic referendum to decide their constitutional future in Europe, yet we in Scotland are denied the chance of a referendum on our democratic future? Why do we not have a referendum on Maastricht and Britain's future in Europe—and on Scotland's future in Britain? Why do the Government not have the guts to face the music in a democratic test?

Mr. Lang: The hon. Gentleman speaks with all the authority of a rave promoter at a time when raves are going out of fashion. If attendances at his raves continue to fall at the present rate, he will soon be able to hold them in his back garden. The Government had the guts to face the electorate in a general election. That was our multi-option referendum—and the electorate of the United Kingdom turned their backs on separation and devolution—[Interruption]

Madam Speaker: Order. Has the Secretary of State finished his answer? I could not hear.

Mr. Lang: Yes.

Mr. Biffen: Will my right hon. Friend use this opportunity to assess what subsidiarity offers him in regard to the scope and discharge of his duties? In view of the widespread interest in this topic, will he ensure that he reports back to the House before we return from the summer recess? Above all, will he confirm that he will assess subsidiarity in relation to Scotland on the basis that Scotland is an historic nation state, not a cap-in-hand Euro-region?

Mr. Lang: My right hon. Friend need have no doubt about the Conservatives' recognition of Scotland's importance, both in historic national terms and in terms of its part and place within the United Kingdom. All our consideration of proposals will take place against a background of determination to uphold both Scotland's place within the United Kingdom, and the integrity of the Union.

Mr. Raymond S. Robertson: Is it not strange that the Opposition parties daily betray their obsession with the idea of the Government taking stock, while at the same time arrogantly dismissing the greatest stock-taking exercise of all—that undertaken by the people of Scotland in the general election? Will my right hon. Friend remind the Opposition that, when the Scottish people took stock, it was the Conservatives who increased their vote and their representation?

Mr. Lang: My hon. Friend is absolutely right. A substantial majority of the Scottish electorate voted for parties that support the Union. The difference between the Opposition and the Government is that we regard the constitution of the United Kingdom as something to be cherished and guarded, while they regard it as a political plaything to be used to their advantage.

Mr. Canavan: Will the Secretary of State remind his hon. Friends that, in the recent general election, three quarters of Scottish voters rejected the Tory Government and supported parties that were committed to the establishment of a Scottish Parliament? Let me take the right hon. Gentleman back to the point raised by my hon. Friend the Member for Glasgow, Hillhead (Mr. Galloway). Why is he so reluctant to accept that the most democratic way of taking stock would be to let the people decide in a multi-option referendum? Is he afraid that the outcome of such a referendum would show overwhelming rejection of the status quo, and overwhelming support for the establishment of a Scottish Parliament?

Mr. Lang: The hon. Gentleman forgets that before polling day his party was opposed to a referendum on constitutional matters. Labour Members planned to force


through the establishment of a Scottish Parliament without such a referendum; only since the election have they changed their tune. They planned to take power with a minority of votes, and to use that as a basis on which to force their policies through, without engaging in the consultation that they now regard as essential.

Mr. Rowe: Is my right hon. Friend aware that, during the general election campaign in my part of the country —where there is not a single Labour Member—the number of people in my constituency, including a large number of Scots who had taken advantage of the historic Union to come south and make their fortunes—[Interruption.]

Madam Speaker: Order. I have stopped other hon. Members who have not put their question. I am now waiting to hear the question that the hon. Gentleman is about to ask the Secretary of State.

Mr. Rowe: Is my right hon. Friend aware that there was widespread support for the Union of the United Kingdom, and will he comment?

Mr. Lang: I am grateful to my hon. Friend. I am sure that that support was reflected in the general election result. The Labour party proposed devolution throughout the United Kingdom, but it was in Scotland, where the proposal was most detailed, that the swing against them was most substantial.

Mr. Dewar: If there is a continuing dispute about the opinions of the Scottish public—which there clearly is—why does not the Secretary of State consider a referendum as a way of deciding the issue, given that he is so confident that he is right?
The Secretary of State will recall the pledge made by Lord Fraser of Carmyllie, the Minister of State, Scottish Office. Lord Fraser said that the Government were committed to constitutional change that was "substantial and not cosmetic". Does he still stand by that? If the Secretary of State is indeed bubbling over with new ideas, will he tell us when just one of them—however modest —will be allowed to creep into the public domain?

Mr. Lang: I know that the hon. Gentleman used that quotation in good faith, but I have to tell him that it is a misquotation. I shall be happy to explain to him afterwards, at greater length and in detail, why and how that is so. I can assure the hon. Gentleman, however, that the Government are taking stock of the matter and will bring forward proposals and lay them before the House when they have considered them fully.

Local Authorities

Mr. Oppenheim: To ask the Secretary of State for Scotland whether he has any plans for unitary local authorities in Scotland.

Mr. Lang: The Government propose, subject to further extensive consultation, to move towards the introduction of single-tier councils throughout Scotland. I intend to issue a second consultation paper in the autumn setting out a range of illustrative options for the new structure.

Mr. Oppenheim: Would not unitary authorities have a number of important advantages, including cutting out costly and sometimes confusing overlaps in responsibilities

and increasing accountability? Would not such enhanced unitary authorities have the added bonus of providing an appropriate platform for many Opposition Members to display their undoubted talents and abilities?

Mr. Lang: My hon. Friend is absolutely right to draw attention to the greater strength and coherence that can derive from single-tier authorities. I regard the possible development of single-tier authorities in Scotland as a way of strengthening local government and making it more coherent, more readily identifiable with local areas and more accountable to local electorates.

Mr. Tom Clarke: Does the Secretary of State accept that many Opposition Members know a little more about Scottish local government than the hon. Member for Amber Valley (Mr. Oppenheim)? Does the right hon. Gentleman also accept, given the short period that has elapsed since the Wheatley report and the reorganisation of Scottish local government in 1975, that the local authorities have acted well and in the interests of Scotland, despite the enormous constraints and demands placed on them by the Government, who are perceived in Scotland as an anti-local government Government? That being so, will the right hon. Gentleman tell the House why in England it is possible to have a commission to review local government whereas in Scotland it is not?

Mr. Lang: I certainly pay tribute to the dedication and professionalism of many involved in local government and to the efficiency with which many local authorities, both regional and district, deliver local services. Nevertheless, events have moved on substantially and quickly over the two decades since the Wheatley commission reported. As regards a changing role for local authorities, we see considerable advantage in moving towards single-tier authorities. However, we shall be introducing another consultation paper in the autumn which will enable further extensive consultation to take place.

Mr. Worthington: Will the Secretary of State confirm that local people want democratically elected and locally accountable councils to run their services? Can he further confirm that he intends that all services that are currently run by local government will continue to be run by local government and, in particular, that education will be run by local government in the future? Will he confirm that that is so?

Mr. Lang: I certainly support the hon. Gentleman's belief in strengthening local democracy. Part of our purpose in bringing forward the reforms is to strengthen local democracy, not to undermine it. The hon. Gentleman asked about the handling of individual services, and that is a matter on which we shall wish to consult widely. It would be quite wrong for me to give a commitment of any kind on any particular service at this stage. I look forward to hearing the hon. Gentleman's reaction to our consultation paper when it appears.

Sunday Trading

Mr. John Marshall: To ask the Secretary of State for Scotland what recent representations he has received about the Scottish law on Sunday trading.

Mr. Lang: Since the beginning of this year, I have received two representations advocating the imposition of restrictions on Sunday trading in Scotland.

Mr. Marshall: I thank my right hon. Friend for that answer, which shows that the majority of Scottish people are satisfied with total deregulation. Does he agree, therefore, that it would be immoral, illogical and hypocritical for Scottish Members to vote to impose upon the people of England and Wales restrictions that do not apply in Scotland?

Mr. Lang: My hon. Friend puts his point effectively. I would simply say that it would be impertinent for me, as a Scottish Minister, to advance my view on what my English colleagues should do with regard to shop hours in England.

Mr. Macdonald: Does the Secretary of State acknowledge that there are problems with the law on Sunday trading in Scotland, particularly in respect of the lack of protection for employees who do not want to work on Sundays? Will the right hon. Gentleman therefore undertake to look again at the legislation to see whether better protection might be provided for employees who, because of their religious convictions, do not want to work on Sundays?

Mr. Lang: That is a matter for negotiation within the various industries and with the various unions involved. I am not aware of any great dissatisfaction. As I said, I have received only two representations about the matter this year. I believe that the arrangements in Scotland work pretty well and are infinitely adaptable to suit the needs of all concerned.

Fishing Industry

Mr. Menzies Campbell: To ask the Secretary of State for Scotland if he will make a statement about the consequences of the one-net rule for the village-based fishing industry.

The Parliamentary Under-Secretary of State for Scotland (Sir Hector Monro): The one-net rule forms part of a package of measures to improve conservation of fish stocks. The package is important for the future well-being of the industry. Certain groups of fishermen are concerned about the implications of the rule and I am keeping the matter under review.

Mr. Campbell: Does the Minister accept that that answer will bring no comfort to the fishing industry in Scotland and in particular, to that part of the industry located in my constituency? The Minister must understand that the imposition of the one-net rule, without changes to the by-catch regulations, is likely to cause a large number of fishermen to move from prawn fishing to white fishing. The one-net rule will have the reverse effect: it will bring increasing pressure to bear on fish stocks. Why are the Government so supine in their efforts to protect the village-based fishing industry in Scotland?

Sir Hector Monro: I am sorry that the hon. and learned Gentleman does not seem to understand conservation. It is absolutely crucial that there are greater restrictions than at present if there is to be a fishing future for Scotland —and I am very keen that that should be so. I have said

that I am considering the situation. The rule has been in force for only three weeks. If there is evidence and good reason, I will give it further consideration.

Mrs. Ewing: Does not the Minister realise that the measure, as currently proposed and implemented, is not working to the benefit of conservation? I endorse all the points made by the hon. and learned Member for Fife, North-East (Mr. Campbell). Why do Ministers responsible for fisheries in Scotland consistently bring back regulations which are not EC-wide, but which apply solely to Scotland to the disadvantage of our fishing communities, which are extremely important for our rural economies and for ensuring the viability of many other communities?

Sir Hector Monro: Of course I share the hon. Lady's view that fishing is vital to rural areas in Scotland. However, she must also understand that if there are no fish, there will be no industry. That is why we have to be so strict on conservation. The hon. Lady must also understand that under the by-catch rule, there may be a 60 per cent. catch of white fish. If that is insufficient, the fishermen can go home to harbour and change to a larger mesh and start again.

Juvenile Crime

Mr. Norman Hogg: To ask the Secretary of State for Scotland when he next expects to meet the chief constables to discuss juvenile crime.

Lord James Douglas-Hamilton: My right hon. Friend the Secretary of State meets chief constables from time to time to discuss a wide range of policing issues. Also, my right hon. and noble Friend the Minister of State has today invited chief constables to meet him to consider the substantial and alarming increase in the illegal use of shotguns and other firearms.

Mr. Hogg: Does the Minister accept that there is some correlation between juvenile crime and under-age drinking? Will he introduce proposals to strengthen the licensing laws so that they are better able to control abuse? Will he also try to speed up the report on drinking in public places with a view to extending it to the whole of Scotland?

Lord James Douglas-Hamilton: We have reformed the law on licensing. We stiffened up the law in respect of late-night licences where there was evidence of disorder. The byelaws and experimental schemes that are in operation will be reviewed in due course and we will then consider, when it is appropriate, whether they should be extended throughout Scotland. However, that is still some months away.

Sir Nicholas Fairbairn: Does my hon. Friend comprehend that frequently what is forbidden is preferred and the fact that in Scotland on Sunday one can shop and do what one likes, which has always been the norm in Scotland—

Madam Speaker: Order. Clearly, the hon. and learned Gentleman is referring to the wrong question. Therefore, I call Mr. Michael J. Martin.

Mr. Michael J. Martin: Hardly a night goes by in my constituency when children as young as 10 or 11 do not steal cars. That resulted in a fatality in the Possilpark.


Doctors who happened to walk into a gang of fighting youths were brutally beaten up. That is happening not only in my constituency but throughout the west of Scotland. Is not it time that the Minister met the chief constables of Scotland to discuss that serious problem?

Lord James Douglas-Hamilton: Yes. As I have mentioned, the Minister of State is writing today to the chief constables inviting them to a meeting with him, particularly to discuss the alarming increase in the use of firearms. I strongly support community policing. On urban aid, we give the best part of £1 million to a variety of projects dealing with drug and alcohol abuse, safe neighbourhood projects, security assistance for small businesses and household security measures. Much is being done. We have increased capital allocations to the police by £6 million this year.

Poll Tax

Mr. Wallace: To ask the Secretary of State for Scotland what discussions he has had with the Convention of Scottish Local Authorities regarding the recovery of poll tax arrears; and if he will make a statement.

Mr. Allan Stewart: The subject of community charge collection has been discussed at a number of my right hon. Friend's meetings with the Convention of Scottish Local Authorities about local government finance matters in the past year or two.

Mr. Wallace: I am sure that the Minister shares with me the concern of many people who have bigger poll tax bills because of those who have not paid. Will he accept that one of the biggest non-payers are the Government, who could have been paying a substantial contribution from central Government funds to meet the rebates of many who could not pay? How much would have been due from central Government? Will the Minister now make that sum available to local authorities, or is the Government's policy "can pay, won't pay"?

Mr. Stewart: Of course we shall not do that. The non-payment problem certainly does not apply to the hon. Gentleman's constituency. For Orkney in 1989–90, the percentage of what was actually paid as against the payment assumption was 111.8 per cent. —12 per cent. more than estimated. In 1990–91, the figure was 100 per cent., and at the end of March it was 85.7 per cent. The problem has been variable. Frankly, it has arisen where authorities have been reluctant to use all available powers at the outset. That has created a non-payment culture, and that is what has created the problem.

Dr. Liam Fox: Will my hon. Friend give a firm commitment to recover as much arrears as is humanly possible? If he does not, the burden will fall upon decent law-abiding poll tax payers not only in Scotland but in the whole United Kingdom.

Mr. Stewart: My hon. Friend is right. Within Strathclyde there is tremendous resentment at the fact that people have to pay for those who have not yet paid the community charge. Local authorities have a statutory duty to collect outstanding charges. I make it clear to my hon. Friend and to the House that there is absolutely no question of an amnesty for non-payers. That would be wholly unfair to the majority of law-abiding taxpayers.

Mr. Maxton: Is it not the case, however, that the majority of those who have not paid are among the very poorest, who were forced to pay the absurd minimum 20 per cent. payment? Even now, the Minister could resolve at least some problems by abolishing the 20 per cent. minimum payment, backdated to 1 April. He should also restore to local authorities the right to look at each individual case on its merits before deciding whether to take action against a person. If he did that, many problems would be resolved.

Mr. Stewart: People on income support have had their benefit uprated each year to take account of the liability for the maximum 20 per cent. that they pay. It has been made clear again and again that there will be no removal of the 20 per cent. rule for the community charge for 1992–93, because it is a personal tax. There has been much publicity about some of the measures being taken by Strathclyde and Lothian in respect of precisely the people about whom the hon. Gentleman is talking, and that is those who have not paid but can pay. It is absolutely right that those authorities concentrate on doing that. My criticism is that they did not use the powers available to them sufficiently quickly and, therefore, a climate of non-payment was allowed to build up in some areas.

A1

Mr. Beith: To ask the Secretary of State for Scotland what plans are being prepared for dualling sections of the A1 which are not already listed in the roads programme.

Lord James Douglas-Hamilton: Preparation work is under way to dual the A1 between Tranent and Haddington and Haddington and Dunbar, between the Dunbar cement works junction and Innerwick, between the southern terminal of the Cockburnspath bypass and Penmanshiel and at Lemington. In England, two schemes to complete the Alnwick bypass are being taken forward. Further schemes to complete the dualling between Newcastle and north of Alnwick are being identified with a view to their inclusion in the roads programme.

Mr. Beith: Does the Minister recognise that if the announcement that he made on 2 March is to have substance, the process will have to be maintained? New projects will have to be brought into the roads programme in both Scotland and England each year if there is to be a complete dual carriageway from Newcastle to Edinburgh. Dualling would make the road much safer and worthy of its strategic requirements.

Lord James Douglas-Hamilton: I agree with the right hon. Gentleman and I look forward to meeting him and the other interested Members of Parliament on 7 July when we shall have a progress report.

Mr. Home Robertson: I look forward to that meeting. I welcome the Minister's announcement of progress on dualling sections of the road in East Lothian. When will he give us an idea of the timetable for those works and, indeed, for completing the whole of the dualling of the Al from Musselburgh to Morpeth, in accordance with the undertaking given by the Government—undoubtedly by pure coincidence—just before the general election?

Lord James Douglas-Hamilton: The Government's aim to dual the A1 has been clearly stated. Firm and ambitious plans for the next stage of work have been announced in some detail. Progress outwith the public expenditure planning period must, for the A1 as elsewhere in Scotland, including Ayrshire, depend on the resources available and the relative claims of schemes elsewhere. Obviously, we take into account the importance of the A1 project. The commitments given by the Government are more significant than those given by the Labour party.

Mr. Trimble: Is there any provision in the roads programme for the further improvement of the A75, in particular to bypass the village of —

Madam Speaker: Order. I was being most generous to the hon. Gentleman because I believed that his question had a connection. It is most unfair to take advantage of my generosity.

Housing Policy

Mr. McAllion: To ask the Secretary of State for Scotland when he next expects to meet the Convention of Scottish Local Authorities to discuss housing policy in Scotland.

Lord James Douglas-Hamilton: I expect to meet representatives of the housing committee of the Convention of Scottish Local Authorities on 24 September, when a range of housing issues will be discussed.

Mr. McAllion: Will the Government review their policy on housing, under which the best of council housing has been sold off and not replaced and much of the rest reduced to little better than welfare housing? Does the Minister understand that if the Government can claim to have achieved anything during the past three Parliaments, it is the creation of housing apartheid in Scotland? Large tracts of our cities are cut off and crucified by high levels of unemployment, poverty and crime. Such areas have a parallel only in the impoverished third world. Why, in a country as rich and wealthy as Scotland, are the Government, whom we never elected, failing so miserably to meet the aspirations of ordinary Scots to have a decent house to live in?

Lord James Douglas-Hamilton: A few days ago I was at Whitfield in the hon. Gentleman's constituency. People were celebrating the 1,000 jobs produced by the partnership as well as the housing regeneration. If the hon. Gentleman had been present, he would know that substantial progress had been made in his constituency. We also intend to reform the law on the right to buy and introduce streamlined procedures. The hon. Gentleman must appreciate that if the houses that were sold had not been bought, the same families would have continued to rent them for a reasonable time. I also opened the Stopover project in Dundee, which is doing a good job for the homeless. It serves a useful purpose.

Mrs. Fyfe: May I thank the Minister for finally agreeing to visit Maryhill to see the worst of the housing there. I am sure that he found it informative. Does he recognise that when housing associations attempt to provide housing for people with special needs, they face particular difficulties because of the complexity of funding, which is spread

between social work departments, health boards and Scottish Homes? Will he meet appropriate representatives during the summer recess to seek to overcome that problem and to give some reassurance to the housing associations that specialise in that important task?

Lord James Douglas-Hamilton: Obviously, we want to give the maximum encouragement to housing for special needs. I should be grateful if the hon. Member could give me a note of all the difficulties that she is experiencing. I shall look into them thoroughly. Scottish Homes has a budget of £300 million and ought to be able to make suitable arrangements on those matters, but perhaps the hon. Member could get in touch with me.

Mar Lodge

Mr. Kynoch: To ask the Secretary of State for Scotland what steps he will take to assist in the preservation of the unique natural heritage present in the Mar Lodge estate.

Sir Hector Monro: I have asked Scottish Natural Heritage to seek a management agreement with the owner of Mar Lodge estate, which will safeguard the estate's outstanding natural heritage qualities for the future.

Mr. Kynoch: I very much welcome my hon. Friend's announcement, but I should be interested to know whether he is aware whether the Mar Lodge estate is still on the market. If it is, what will he do to revive the purchasing consortium, which has temporarily withdrawn its interest, largely because of its inability to fund future running expenses?

Sir Hector Monro: In 1990, the owner planned to sell, but the estate has never formally been on the market. I assure my hon. Friend, who obviously takes a great interest in that area of his constituency, that we are anxious, through Scottish Natural Heritage, to set up a management agreement and to maintain and safeguard that fine example of natural heritage. We shall be in close touch with the owner, if the consortium comes into being again and finds a positive way forward.

Mr. Dalyell: How can the Secretary of State for the Environment make the sort of speech that I heard this morning at the natural history museum, and how can the Prime Minister speak as he did at Rio to developing countries, when we cannot do anything constructive to safeguard Mar Lodge? Does the Minister realise that the management agreements are unlikely to save the ancient forest? Since my friendly and constructive meeting with him in his room, what follow-up has there been about someone from the Government, or sponsored by the Government, talking to Mr. Kluge properly about the possibility of a Kluge memorial park?

Sir Hector Monro: I agree that we had a useful discussion and I assure the hon. Gentleman that we are determined to look after the important parts of the estate through a management agreement. He also knows that it will form part of the Cairngorm working party report later this year, under Magnus Magnusson's chairmanship. We are not sitting back idly, but are reacting positively to see what can be done in a difficult situation.

Overseas Adoptions

Mr. Thurnham: To ask the Secretary of State for Scotland what representations he has received about the adoption by British couples of orphans from Romania and other countries overseas; and if he will make a statement.

Lord James Douglas-Hamilton: The adoption of children from Romania is now subject to an agreement concluded in March between the United Kingdom and the Romanian Committee for Adoptions. There have been no recent specific representations about the adoption of children from Romania or other countries overseas.

Mr. Thurnham: Will my hon. Friend work closely with his colleagues in other Departments, in view of the difficulties that have arisen with the Romanian adoption committee's agreement, which has prevented more than a handful of Romania's 100,000 orphans being adopted by British couples?

Lord James Douglas-Hamilton: Yes, I shall certainly do so. My hon. Friend obviously speaks on behalf of prospective parents and I appreciate their concern. On 20 January we consulted on a wide review of adoption law and on how inter-country adoption might be integrated with existing adoption arrangements and immigration procedures in a Scottish consultation paper. If my hon. Friend has any representations they will be welcome. The agreement between Britain and Romania has insisted on the highest standard of assessment for prospective adopters, and similar agreements have been struck between Romania and other countries. There seem to be limited prospects for change.

Mr. McFall: Will the Minister join me to congratulate the Strathclyde appeal for Romanian children which, for the past year, has been working in Romania and has gathered more than £1 million from citizens, both young and old, in Strathclyde? It has done a marvellous job at Guru Ochnitei, where it has provided accommodation for 350 severely disabled children, due to the generosity of the citizens of Scotland. Does he agree that we should listen to the Romanians and should not allow people to go to Romania to plunder and take the brightest and the best of the Romanian children, but should instead work with the Romanians, as the Strathclyde appeal did, to bring Romania's health care policy into the 21st century?

Lord James Douglas-Hamilton: We very much welcome the activities in Strathclyde in that connection. The hon. Gentleman is right that this is essentially a matter for the Romanians and that the scope for change is very limited. However, it is right that so much concern has been shown by prospective adopters in this country and that such matters are now being dealt with thoroughly and professionally.

NHS Trusts

Mr. Chisholm: To ask the Secretary of State for Scotland if he will make a statement on the likely timetable for hospital opt-outs in Scotland.

Mr. Allan Stewart: The timing of national health service trust applications is largely a matter for hospitals themselves. For those considering trust status in April 1993 applications will be required by the end of this month. Hospitals interested in becoming trusts in 1994 will be required to make formal declarations of interest by 30 September 1992 and applications by 31 March 1993. This cycle will be repeated annually.

Mr. Chisholm: The Minister seeks to perpetuate the fiction that opt-out hospitals in Scotland arise out of demand from hospitals and local communities. As everybody knows, the policy of opt-out hospitals has been imposed on the people of Scotland, against their wishes, by the Scottish Office. A timetable for that imposition exists within the Scottish Office. Is not it true that most hospitals in Edinburgh, for example, are scheduled to opt out in 1994, including the Western general hospital, which serves my constituency?

Mr. Stewart: On the first point, my reply was the answer to the question that the hon. Gentleman tabled on the Order Paper.
It is up to hospital boards to express interest and put in applications. We are not imposing the policy, but we are encouraged by the level of interest that has been expressed around the country since the threat of a Labour Government was so effectively removed by the people of the United Kingdom.

Points of Order

Mr. Dennis Canavan: On a point of order, Madam Speaker. As you know, earlier today, I gave written notice to your office that I intended to move the Adjournment of the House under Standing Order No. 20 for the purpose of debating a specific and important matter which should have urgent consideration, namely,
the failure of this Government to respond to the democratic wishes of the people.

Madam Speaker: Order. The hon. Member is being a little unfair. I have already considered his application and he knows my decision. The matter has been considered very seriously and he should not now raise it on the Floor of the House. I hope that the hon. Member will leave the matter there because he knows my decision and our procedures.

Several Hon. Members: rose—

Madam Speaker: Order. Let me deal with one point of order at a time.

Mr. Canavan: I have not even raised my point of order.
I realise that you, Madam Speaker, have absolute discretion in whether such an application is accepted or rejected. However, your staff informed me that there was no way in which you would even listen to my application. Irrespective of the rights and wrongs of the issue, which is important to the people of Scotland, that is an attack on the rights of Back Benchers to raise legitimate points on the Floor of the House.
I ask you, Madam Speaker, please to explain which part of the Standing Order No. 20 I fell foul of. On my reading of the Standing Order, I stuck by the rules that it lays down. I kept to the 12 noon deadline and I put in written notice, yet I am deprived even of the opportunity to state my case on the Floor of the House.

Madam Speaker: Standing Order No. 20 allows me to hear applications for debates on
a specific and important matter that should have urgent consideration.
To qualify for consideration, a matter must contain some new element of urgency that distinguishes it from other important issues of long standing. I cannot allow this valued opportunity to be endangered by improper use, and I shall continue to decline to hear applications that do not meet the basic criteria. The hon. Gentleman's application falls into that category, and I can hear nothing further about it.

Mr. George Galloway: On a point of order, Madam Speaker. Is not what happened this afternoon symptomatic of the contempt for Scottish questions shown by Conservative Members? Three Conservative Members were called by you to ask questions: you had to rebuke the hon. Member for Stockton, South (Mr. Devlin) for speaking for too long and not coming to the point; the hon. Member for Amber Valley (Mr. Oppenheim) asked about Scottish local government; and the hon. and learned Member for Perth and Kinross (Sir N. Fairbairn) asked two questions, one of which you declared to be wrong. Shortly after asking their

questions, all three Members left the Chamber, the hon. and learned Member for Perth and Kinross weaving his way unsteadily from the Chamber—

Madam Speaker: Order. I need no colourful or picturesque descriptions. I should be grateful if the hon. Gentleman would come directly to his point of order.

Mr. Galloway: The hon. and learned Member for Perth and Kinross is unlikely to need colourful or picturesque descriptions from me. I am stating the truth as people saw it on television. He did stagger from the Chamber—

Madam Speaker: Order. Please come to the point of order for the Chair.

Mr. Galloway: Is there no basic requirement on Members who ask questions to stay in their places until the end of Scottish questions? Is it just a big game for Conservative Members? Are they swept off the Terrace to come here, do their job and then leave?

Madam Speaker: Order. I have already made my views known on this. We must extend various common courtesies to each other, not only during debates but at Question Time. I remind the House that this is a United Kingdom Parliament and when Members rise and show an interest, and when they have questions on the Order Paper, I have an obligation to call them.

Mr. John McAllion: Further to the point of order raised by my hon. Friend the Member for Falkirk, West (Mr. Canavan), Madam Speaker. You said that there was no new element of urgency and that that was the reason for your decision. However, following last month's Scottish questions, I gave notice to you that I intended to raise on the Adjournment of the House the question of a referendum, only to be told that I was not allowed to do so under the Standing Orders of the House because it involved legislation or expense. That ruling was given to me only yesterday.
Is not that a new element of urgency, because it is important that the House has an opportunity to hear the case for a referendum on a Scottish Parliament? It may not be especially urgent for hon. Members who represent English constituencies because this is an English Parliament—[HON. MEMBERS: "No".]—but Scotland does not have the Parliament that it wants—

Madam Speaker: Order. There is nothing new about the rules governing the Adjournment of the House. I must work according to our rules and procedures, and I am sure that the entire House wants me to continue to uphold those rules and procedures.

Mr. Paul Flynn: On a point of order, Madam Speaker. You will have heard on many occasions in the House assurances from Ministers that they were doing all that they could to safeguard the INMOS jobs in Newport. Today's Electronic Times contains a report by Michel Carpentier of DGXIII saying that the Department of Trade and Industry has never been in touch with him on that matter. He believes that it is stupid to transfer the jobs from Newport to Italy and that money is available. Have you, Madam Speaker, been asked to allow the appropriate Minister to make a statement or a confession?

Madam Speaker: I can give a very short answer to that question: no, I have not.

Mr. John Marshall: On a point of order, Madam Speaker. Is it in order for hon. Members to spend time calling for a referendum in Scotland when, during the general election, they said that they were against a referendum?

Madam Speaker: That is not a point of order for me, and it only lengthens the time spent on points of order. I have heard bogus points of order, but that one really went over the top.

Mrs. Margaret Ewing: On a point of order, Madam Speaker. I listened with respect to your ruling on the request of the hon. Member for Falkirk, West (Mr. Canavan) for a debate under Standing Order No. 20. I find it exceptionally difficult to understand the justification for saying that the proposal contains no new element when the arguments have not been heard. It is clear that the hon. Gentleman would have been able to raise relevant new elements during the debate. Are you, Madam Speaker, saying that when we apply for a Standing Order No. 20 debate we have to write our full speech in advance so that you and your staff may decide whether it contains a new element?

Madam Speaker: I think that the authorities of the House and I know when there are any new elements. I am sure that the hon. Lady is not seeking to challenge my ruling.

Mr. Peter L. Pike: On a point of order, Madam Speaker. Have you received a request from the Government to make a change in the Government's programme to allow the introduction of legislation to protect pension funds? I ask that in view of the fact that £2 million has been taken from the Bellings group pension fund. The matter is becoming a scandal and the Government need to take action to protect pension funds in this country.

Madam Speaker: I have nothing to add: I have received no request for a statement to be made.

Mr. Robert Maclennan: Further to your ruling, Madam Speaker, in respect of the application made by the hon. Member for Falkirk, West (Mr Canavan), will you explain what evidence you require to be submitted to you before your officials rule that a matter is unsuitable for debate? It is my understanding that, in the past, supporting evidence has normally been heard in the House, not in the Speaker's office.

Madam Speaker: I think that the hon. Gentleman is raising with me what I regard as a classic hypothetical case. I said that to qualify for consideration a matter had not only to contain a new element of urgency to distinguish it from other important long-standing issues, but had to be on a specific and important matter that needed urgent consideration. I do not believe that our business today or tomorrow should be changed in order to discuss the subject raised by the hon. Member for Falkirk, West (Mr. Canavan). I hope that hon. Members will not continue to challenge my ruling.

Mr. Alex Carlile: On a point of order, Madam Speaker. The Special Grant Report (No. 4) and the Special Grant Report (Wales) 1992 are on today's Order Paper for debate. It appears that it is your intention that we should debate the two reports together. If that is

so, it is a break from the custom of the House, which is to have a separate debate on Welsh rate support grant orders. With great respect, may I suggest that we should keep to the usual form of proceeding so that Welsh Members may have a better opportunity to contribute to the debate and we have more chance to hear Welsh Office Ministers?

Madam Speaker: I appreciate the hon. and learned Gentleman's point and understand it, but it was agreed last Friday by the House that the two items should be debated together within a three-hour period.

Mr. Jimmy Wray: On a point of order, Madam Speaker. The most important item on today's Order Paper is question 8 on local government reform, which will affect the life of every councillor in Scotland. I could not understand why you allowed only one Opposition Back Bencher to ask a question on the subject. I think that was absolutely disgraceful.

Madam Speaker: I have a broad back, and I am developing a thick skin.

Mr. Canavan: On a point of order, Madam Speaker. I have no wish to challenge your right to accept or reject an application under Standing Order No. 20. However, for future guidance, if in future an hon. Member decides to make a written application to you for a Standing Order No. 20 emergency debate, should he or she outline in the application any new evidence that he or she thinks should be brought to your attention there and then or will there be a further opportunity to present the new evidence on the Floor of the House?

Madam Speaker: That is certainly not necessary. I want to be helpful to the House and to individual Members, and if Members think that it helps me to come to a judgment by putting new evidence before me, it will always be very welcome and I shall look at it most carefully.

Mr. David Winnick: On a point of order, Madam Speaker. I am not in any way challenging your ruling. As you are probably aware, the Procedure Committee recommended some years ago that any application under what was then Standing Order No. 9 should be put to the Speaker in his office. That recommendation was considered by the House and, I am glad to say, it was rejected in 1979. You will also know that in 1977–78, in the last couple of years of the Labour Government, there were usually three or four applications per day under Standing Order No. 9. It is my understanding—and you will correct me if I am wrong—that until quite recently, although the Speaker may well have deprecated some of the applications, he decided to hear them.
It seems that there are two problems to overcome. Under "Erskine May" and the appropriate Standing Order you decide whether an application on the Floor of the House is to be successful. If it is, you will grant a debate. However, it now seems that even before the application is made on the Floor of the House you will consider whether it should be made at all, in the same way as your predecessor did—I doubt whether his predecessor followed the same course. In effect, that means that we have to convince you that there is a case even though if the application is made on the Floor of the House there is no guarantee that you will grant it.

Madam Speaker: I am not changing the practice. I cannot hear applications that I regard as not getting to first base. On occasions I will hear an application, but I have to determine in the first place whether it gets over the first hurdle. There is no change whatever in procedure.

Dr. Norman A. Godman: On a point of order, Madam Speaker. Apart from the problem of irritation caused by English Tory Members flitting in and out during Scottish Question Time, may I appeal to you once again about the problem of Ministers giving over-long answers to questions? I am sure that that practice deprives two or even three Back Benchers of the opportunity to put spontaneous supplementary questions.

Madam Speaker: I have noted the hon. Gentleman's point. At the risk of being rather too curious and too observant, may I say that I have noticed that he too popped out after his question.

BALLOT FOR NOTICES OF MOTIONS FOR FRIDAY 10 JULY

Members successful in the ballot were:

Mr. Paul Murphy
Mr. George Howarth
Mrs. Jane Kennedy

STATUTORY INSTRUMENTS, &c.

Motion made, and Question put forthwith pursuant to Standing Order No. 101(3) (Standing Committees on Statutory Instruments, &c.],
That the draft Companies (Single Member Private Limited Companies) Regulations 1992 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Kirkhope.]

Question agreed to.

Disabled Persons (Services)

Mr. Andrew Rowe: I beg to move,
That leave be given to bring in a Bill to empower local authorities to make certain severely disabled persons accountable for expenditure on their care plans.
This is a modest measure designed to assist the Government to solve a problem that has caused them embarrassment more by an accident of history than fault of their own. The problem is that some men and women who are severely physically disabled, with relatively little control over their bodies but with their minds entirely unimpaired, want to remain in charge of their own lives to as great an extent as possible. They want to be able to decide for themselves when they get up in the morning or go to bed at night, decisions which for most of us are part of normal adult life. Yet under present arrangements, whereby local authorities have to provide the domiciliary care staff that are needed to allow disabled clients to live in the community, it is impossible to guarantee such freedoms.
Take, for example, the case of Ms. C, who has a senior position in a company running training and education courses throughout the country. Sometimes she has to ask her care assistants to arrive at 5 am to ensure that she is up in time for a meeting. Sometimes she has to stay away overnight and take a personal assistant with her. No local authority provided service can offer that degree of flexibility and control. Yet until recently Ms. C has been able to make her own arrangements because the local authority has been paying directly to her the part of her total care budget that is needed for domiciliary care. She has recruited, trained and deployed the staff that she needs and accounted for the money to the local authority.
Why "until recently"? I am sure that you can imagine the shock, Madam Speaker, which went through the system when almost the first guidance issued by the Department of Health under the new community care legislation was to warn local authorities that by allowing such arrangements they were breaking the law. The National Assistance Act 1948, echoed in the national health service Acts of 1968 and 1977, makes it illegal for local authorities to make cash payments to individuals, and the Government have no choice but to remove from some of the most disadvantaged people in Britain the one freedom which they most treasure. That is the problem which the Bill seeks to address.
As you would undoubtedly be quick to remind me, Madam Speaker, a ten-minute Bill may not stray into territory such as giving local authorities the power to make direct payments, ideal though in my judgment it would be if they could. It is a severe limitation. I am proposing a device to improve the present position, but I know that it is very much a second best.
The limitation is well shown by the case of Mr. A. His local authority allows him to employ staff and manage them on a day-to-day basis, but the authority pays them and they are subject to the employment practices of the authority. The effect of its shift systems, for example, is that he cannot choose when he will go to bed. Nor can he suddenly alter the arrangements to fit in with an unexpected change in his schedule.
What a contrast with the case of Mr. F. He receives about £15,000 a year. It is paid into a separate bank


account and out of it he meets all the payments for his personal assistance. The account is open to the local authority to inspect at any time and at the end of each year Mr. F presents an audit of his account to the local authority. It is a simple system that is cheap to administer. It retains the statutory responsibility of the local authority and makes it easy for the authority to assume direct control if Mr. F, for whatever reason, found that managing his affairs in this way was too much for him, but affords him the dignity and independence that we would all seek for ourselves.
My proposition is, by contrast, inferior but is all that I can propose in the context of a ten-minute Bill. I propose that such disabled people as are assessed as able and willing to shoulder the responsibility of recruiting and employing their own staff should be allowed to do so up to the financial limit decreed by the local authority. They should then arrange to have the bills paid by the local authority, but the responsibility for the staff contracts would be theirs.
We have a parallel in the House. The office costs allowance is available to Members to make such arrangements as seem best to them to meet their needs and those of their constituents. The bills are handled by the Fees Office, which exercises some scrutiny over the payments to ensure that they do not depart from the rules that have been laid down. In this way we are in charge of our own offices, but the interests of the taxpayer are safeguarded. For the few clients that I envisage it is an unnecessarily cumbersome system, but is better than the position that we are left in by the recent guidance from the Department.
The Bill is modest, but the principle that it enshrines is fundamental to community care. Community care is partly about enhancing the dignity of those who need public care. It is also about enhancing choice, developing personal responsibility and encouraging the growth of personal capacity. It must, therefore, be right to allow those disabled people who have the capacity and the desire to take control of the most personal part of their care arrangements to do so.
When the National Assistance Act reached the statute book 44 years ago, the relationship between those who needed care and those who gave it was very different from what it is now. I know that Ministers know that. Nobody who listened to Ministers, hour after hour, in the National Health Service and Community Care Bill Standing Committee has any doubt about where their hearts lie. I know that my hon. Friend the Member for Suffolk, South (Mr. Yeo), who is on the Treasury Bench today, shares their views.
My Bill aims to take the first step towards enabling disabled persons to cut off the shackles imposed upon them by long-dead Acts of Parliament and to restore to some severely disabled persons the dignity of making their own decisions in an area of their lives where no public authority, no matter how benevolent, can hope to treat them as well as they can treat themselves.
I hope that the Government, who have done so much already to increase the control that disabled people have over their own lives and who have introduced the citizens charter to carry that work forward, will give my Bill a fair wind or, even better, go the whole way and allow direct payments in carefully selected cases. When I worked on the Social Work (Scotland) Bill 25 years ago, we wrote into it section 12, which allows cash payments in special circumstances to be made by local authorities to people in their care. I feel that that is a better precedent in 1992 than the National Assistance Act of 1948.

Question put and agreed to.

Bill ordered to be brought in by Mr. Andrew Rowe, Mr. Tom Clarke, Sir John Hannam, Ms. Liz Lynne, Rev. Martin Smyth and Mr. Dafydd Wigley.

DISABLED PERSONS (SERVICES) BILL

Mr. Andrew Rowe accordingly presented a Bill to empower local authorities to make certain severely disabled persons accountable for expenditure on their care plans: And the same was read the First time; and ordered to be read a Second time upon Friday 11 December and to be printed. [Bill 44.]

Local Government Finance

The Parliamentary Under-Secretary of State for the Environment (Mr. Robin Squire): I beg to move,
That the Special Grant Report (No. 4) (House of Commons paper No. 61), which was laid before this House on 17 June, be approved.

Madam Speaker: I understand that it will be for the convenience of the House to debate at the same time the second motion on the Order Paper:
That the Special Grant Report (Wales) 1992 (House of Commons Paper No. 80), which was laid before this House on 19 June, be approved.

Mr. Squire: I think that I should be marginally exaggerating if I suggested that the country, or the majority of Members of Parliament, were on the edges of their seats because of the nature of what I am about to say on these reports, despite the fact that their provisions will affect nearly every household in England and Wales and despite also the fact that the sums involved are substantial.
The purpose of the two reports is to provide grant support to billing authorities in England and Wales towards revenue expenditure incurred in the financial years 1991–92 and 1992–93 on preparation for the council tax. The grant underlines our firm commitment to helping authorities with the smooth implementation of the new tax and to ensuring that they are ready to issue the first bills by 1 April 1993.
For the convenience of the House, it might be helpful if I outlined briefly the advantages of the council tax, which is the subject of the preparations that we are considering. We believe that the council tax is fair and straightforward. It introduces a system of finance which will bring stability to local government.
The new tax is fair. It recognises that no household should have to pay an excessive amount towards the provision of local services. It makes provision for single adult households, and it is only right that they should pay less than households with two or more adults. It ensures that people on low incomes and vulnerable groups are helped through generous rebates of up to 100 per cent. of their liability. Owners of property that is no one's main residence will have to pay only 50 per cent. of the tax for the area.

Mr. Dafydd Wigley: In preparing the legislation and the rules that will enable a 25 per cent. reduction to be given to single-person households, will the Minister bear in mind the possibility of applying those rules to give a similar reduction for water charges which could be based on the same register?

Mr. Squire: I understand the hon. Gentleman's question, but I suspect that he is trying to lead me into matters that are rather wider than the reports. However, his question has been heard and I am sure that it will be noted by those who are considering such matters.
The council tax is straightforward. We firmly believe that it will be easier to administer than the community charge, and it will be more easily understood by the public. There will be approximately half the number of bills. Many people who are now liable for the community charge will have their liability removed under

the council tax. The new bills will be based on properties, and collection difficulties should therefore be minimised.
s
The council tax also has the considerable advantage for local authorities of not requiring them to compile and maintain a register of those who are liable to pay—[Interruption.] The hon. Member for Sheffield, Brightside (Mr. Blunkett) expresses doubt from a sedentary position, but I am sure that he will develop his ideas later.
Most households will receive and pay a standard bill. The local authority does not need to concern itself with the number or status of adults in each household. All it will need to know is the name of the liable person, and we have given authorities sufficient powers to ensure that they gain that information.

Mr. Roy Beggs: rose—

Mr. Squire: May I make a little more progress and then I shall willingly give way.
There is abundant evidence of market prices for most property types, and capital values are easily understood by most people. The council tax builds on those advantages and adds to them the benefits of a banded system. Banding will ensure that an excessive burden does not fall on a minority of properties, as happened under domestic rates. Banding also reduces the administrative task involved in maintaining a local finance system by obviating the need for precise valuations. With no attempt at such precision, the likelihood of disputes and appeals is greatly reduced. Capital values are related to ability to pay, but we recognise that it is not a perfect match which is why there is a 3:1 ratio between bills of properties in the highest and lowest bands.

Mr. William O'Brien: What are the Government doing to speed up the extensive delays in outstanding appeals? When the new council tax is introduced, I envisage a string of appeals to local appeals tribunals and the delays will be substantial. What will the Government do to reduce the number of appeals?

Mr. Squire: I do not necessarily accept the premise behind the hon. Gentleman's question about the number of appeals, hut, as he knows, the independent body that runs the tribunals is aware of its responsibilities. The Government have recently stressed that we wish appeals to be settled as quickly as possible. The most recent figures that I have seen show that there has been a pick-up in the number of appeals being resolved.
The discount system is straightforward. Authorities will have a duty to try to establish the discount entitlement of each household in their area, but if that information is not forthcoming, authorities will be able to assume that the household is subject to a standard bill and it will then be up to the household to claim a discount and to supply the local authority with the necessary information to verify that claim.
The council tax will provide stability for local authorities. The tax base will remain fairly constant from year to year. The number of dwellings in any area is not usually subject to significant change. As the House knows, movements of people are far more volatile and they will not have such a great effect as under the community charge.

Mr. David Winnick: Should not the Minister be a little more hesitant in praising the virtues of


the council tax? He will remember that when the poll tax was introduced he was a Back Bencher and, indeed, a critic. The Ministers who introduced the poll tax told us that it was excellent and that Labour was exaggerating the problems. We were told that it would work well, but we all know what happened.—it destroyed Mrs. Thatcher. Would not it be wise for the Minister, who was one of the few long-standing critics of the poll tax on the Tory Back Benches, to be more hesitant about the council tax's virtues and to bear in mind some of the criticisms that will be heard from the Labour Back Benches—and certainly from our Front Bench—about some of the defects of the new tax?

Mr. Squire: I shall take the hon. Gentleman's words of warning to heart—although I must add that a detailed study of the comments on local government finance of every hon. Member on both sides of the House over the past 10 years would prove an indigestible meal for anyone who chose to confront it.
I shall now deal with the preparations and the grants before us. My Department commissioned an independent firm of consultants—CSL Group Ltd.—to estimate the additional costs to local authorities of preparing for the council tax. It estimated that local authorities would need to spend £165.3 million in 1991–92 and 1992–93.

Dr. Lynne Jones: Will the Minister assure us that clarification will soon be issued on the treatment of the software costs of implementation of the council tax? I understand that CSL assumed that software costs could be capitalised, which would not be in accordance with the Local Government and Housing Act 1989. Local authorities urgently need clarification.

Mr. Squire: I shall try to cover that issue in my speech, but if I do not do so, I trust that my hon. Friend the Under-Secretary of State for Wales, who is to reply, will be able to supply the detailed answer that the hon. Lady seeks.
CSL estimates that, out of the sum that I have mentioned, English authorities would need to spend £156..1 million to introduce the new tax. That amount is divided between £114.6 million for revenue and £41.5 million for capital. CSL estimates that Welsh authorities would need to spend £9.2 million—almost £8 million in revenue expenditure and £1.24 million in capital expenditure. The Government have accepted the consultants' recommendations in full.
The special grant report authorises a grant of £85.97 million to English authorities to cover 75 per cent. of authorities' revenue costs. That amount is outside the total aggregate external finance set for local authorities in 1992–93. The grant is to be distributed on the basis of the number of domestic properties in each area, with an allowance for higher costs in the London area. The Welsh report authorises a grant of £5.985 million.
The number of dwellings used for that purpose is based on information supplied to the Secretaries of State for the Environment and for Wales, which has been validated with local authorities. Annex A of the English report and appendix 2 to the Welsh report detail the amount to be made available to each authority.

Mr. Alex Carlile (Montgomery): Will the Minister give way?

Mr. Squire: I am giving way rather a lot, but I shall still give way to the hon. and learned Gentleman.

Mr. Carlisle: Will the Minister confirm that the grant will cover 75 per cent. of the revenue costs of the change and none of the capital costs, which may involve, for example, computer software? Bearing in mind the fact that, even viewed in the most charitable possible light, the poll tax was a Government mistake, why do the Minister and his Welsh counterpart think that local authorities, which have already been severely punished by the wasted costs of the poll tax, should now have to pay any part of the revenue or capital costs of the change?

Mr. Squire: I shall clarify the position. The Government will make available supplementary credit approvals to cover the full cost of the capital expenditure. The hon. Gentleman will have heard what I have just said, but I am not yet sure whether that fully answered the question asked by the hon. Member for Birmingham, Selly Oak (Dr. Jones). I shall return to the subject later.
The remaining 25 per cent of the revenue funds needed by authorities for council tax implementation will be supported through revenue support grant. If the House approves the report, a payment of 66 per cent. of an authority's grant will be paid on account on 1 November 1992 to authorities in England. Welsh authorities will receive 90 per cent. of grant in 1992–93 through three equal instalments in June 1992, November 1992 and March 1993. The remaining grant payable in 1993–94 in England and Wales is conditional on submission of a claim form by the authority. The CSL report identified a preference among Welsh authorities to fund computer-related costs from revenue sources. That has been taken into account in the Welsh payment arrangements.
The amount to be paid to each authority in respect of preparation costs cannot exceed the amount that the authority has spent on preparation. As a result, it is possible—if a little unlikely—that an authority will be entitled to receive less than the amount shown in the table at annex A and appendix 2 of the reports.
For the purposes of the reports, revenue expenditure is defined as expenditure which a billing authority incurs or has incurred in the financial years 1991–92 and 1992–93 solely for the purposes of preparation for the council tax, and which is not expenditure for capital purposes within the meaning of part IV of the Local Government and Housing Act 1989.
My Department will be issuing authorities with supplementary credit approvals totalling some £41 million to cover the cost of capital works. That answers the point raised by the hon. and learned Member for Montgomery (Mr. Carlile). The SCAs are not subject to a special grant report. They will be issued after 31 March 1993, on the basis of claims submitted by an authority and certified in the same way as the revenue claim form. It may be possible to issue higher SCAs to authorities spending above their allocations if claims from other authorities show spending below allocation. We shall consider the basis for doing that if it becomes clear that overall there is a significant underspend of the total allocation of £41.5 million. The SCAs for Welsh authorities in respect of capital expenditure were issued on 10 March this year.
Both my Department and the Welsh Office have liaised closely with the local authority associations about the level of grant and its method of distribution. The associations


recognise the advantage of a formulaic basis for payment, as it will ensure speedy payment of the grant and, therefore, assist local authorities with their cash flow. I hope that the House will agree that the level of the grant is generous, and a very fair contribution to the necessary costs that local authorities will face in introducing the new tax.
The grants that we are considering are but one aspect —albeit a most important one—of the council tax implementation programme that we have in hand. Once the Local Government Finance Act 1992 received Royal Assent, we moved swiftly to make 10 key sets of regulations to let authorities know as quickly as possible the statutory framework within which they would be operating. Last week my right hon. Friend the Secretary of State for Social Security laid the council tax benefit regulations before the House, and we shall be presenting regulations governing the scope of the council tax transitional relief scheme very shortly. Meanwhile, both Departments are undertaking a comprehensive programme to disseminate information. The aim is to ensure that authorities know how the new system is structured, that they are kept abreast of developments and that they have all the necessary information to ensure a smooth implementation.
At an early stage—last November—both Departments issued all authorities with good practice guidelines and a model implementation plan. These offered authorities advice on the initial stages of setting up project teams and defining implementation targets, and were based on work by CSL. We subsequently asked CSL to do some follow-up work to assess community charge backlogs, and to offer advice on action that authorities might take to reduce them. The study, which is under way, has the support of the local authority associations, and is designed both to help authorities with their community charge work and to free resources for council tax implementation.
Our Departments have also sponsored a detailed council tax computer system specification produced by the local authority systems alliance. It offers advice on all identified user requirements and addresses the varied application needs of authorities for in-house computer development, software house systems and package evaluation. A copy was sent to all authorities, and will be updated as necessary.
With the local authority associations in England and Wales, we are preparing a series of practice notes offering advice on all practical aspects of the new tax. We have already issued three such notes to all local authorities—on valuation lists, liability, discounts and exemptions, and recovery and enforcement. We will issue remaining notes as quickly as possible. We shall produce additional practice notes as the need arises and supplement the existing ones to ensure that they remain of value to local authorities.
In addition to that written advice, my officials have embarked on a series of implementation monitoring visits to local authorities. We have selected more than 30 authorities which represent a broad cross-section of all authority types and locations. The object of the visits is to learn at first hand the practical issues that authorities face. We shall offer help where possible and, perhaps more important, gather information that we can use centrally to

guide us in framing any necessary amendments to the regulations and also to identify subject areas on which additional general advice may be desirable.
That two-way exchange of information is not an isolated exercise. We plan to visit the authorities on a number of occasions over the coming months so that both my Department and the authorities can keep up to date with the current state of play.
Officials from both Departments have also embarked on a series of talks to local authority practitioners at seminars held by the Chartered Institute of Public Finance and Accountancy, the Institute of Rating, Revenues and Valuation and the local authority associations. They were booked for some 30 seminars throughout England and Wales, and I gather that more than half of these have already taken place. The aim is to offer an overview of the tax and answer any detailed points raised. More seminar dates will be added as the occasion arises and, as with the monitoring visits, we intend to ensure that that level of commitment is maintained for as long as local authorities feel it is necessary.
The House may also like to know that officials are liaising with such bodies as the National Association of Citizens Advice Bureaux and the National Consumer Council, and are keeping the computer suppliers closely in touch with developments.
I hope that the House will agree that all this shows our determination to co-operate closely with local government in the implementation of the new tax. The special grant reports are an important and tangible demonstration of our commitment to ensuring that local authorities have the necessary tools with which to do the job, and I commend them to the House.

Mr. David Blunkett: I welcome the fact that the reports are before us today, albeit somewhat belatedly. Having issued them on 4 June under the wrong legislative power—the Local Government Act 1988 instead of the Local Government and Housing Act 1989—the Government had to withdraw and reissue them. We should all say a prayer for the Department's competence in finally managing to find the right legislation under which to issue the reports.
The way in which the council tax saga is unfolding, and the tardiness with which it is being handled, is very reminiscent of the poll tax shambles. I feel like saying, "Here we go again: another tax; another shambles in the making; another last-minute confirmation of information that is essential if local government is to do its job; and another chance for local government to bail out central Government by achieving the impossible within time limits which border on the ridiculous and which make it likely that, if things go wrong, local government will get the blame for the confusion, uncertainty and unpreparedness of the Government."
The truth is that, when the Government pushed the legislation through, they never really expected to have to implement this wretched tax. That is self-evident, and the Under-Secretary knows it.

Mr. Squire: Perhaps the fairest immediate response is to say that if, indeed, we are surprised—and I promise the hon. Gentleman that we are not—our surprise is as


nothing compared with the relief that the Opposition must feel at not having to introduce a tax requiring four separate annual valuations,

Mr. Blunkett: As we never proposed a tax with four separate annual valuations, we do not have to feel relief at not having to implement it. If there was a bright spot on my horizon on 10 April, it was that I would not have to sort out the shambles that you created—the aftermath of the poll tax—or deal with the alterations that a Labour Government would have made to the council tax. We would not have implemented the tax in this form. We would not have used the way that you have chosen to restore a property tax —

Madam Speaker: Order.

Mr. Blunkett: I apologise, Madam Speaker. I still feel that I am on the hustings. My problem is knowing which hustings I am now on. For this afternoon's purposes, may I say that the Government did not believe that they would have to implement the council tax. We knew that, when in power, we would have to alter it to make it workable.
The Minister, rightly from his point of view, eulogised this afternoon about the reintroduction of a property tax. He was right to do that, because such a tax is simple, potentially much fairer than the poll tax, and can be made to work more cheaply. The problem is that the tax, the orders for funding the introduction of that tax and the necessary administration and computer arrangements, will be more costly than Labour's alternative and they are much more confusing in terms of implementation.
Part of the problem is that the council tax is expected to bear such a heavy load in terms of the failure to decentralise the business rate. With only 15 per cent. in England and a much lower percentage in Wales having to be picked up by a local tax of that kind, it is clear that the way in which it has to be implemented and its eventual outcome will be much more problematic. One need only read the leader in The Times today to understand the difficulty.
With such a tax, the powers and functions of local government must be reduced to accord with the ability of those authorities to sustain services instead of having a tax designed to sustain a range of services required by local people.

Mr. Philip Oppenheim: With regard to services, did the hon. Gentleman listen to the programme on BBC 2 last night about a town hall and hear the chief education officer of Labour-controlled Lewisham council in London bemoaning the fact that the council had so organised its school transport contracts that the council's National Union of Public Employees friends and the direct labour organisation could charge whatever they liked? There was no chance of a reduction even if the use of those services decreased. As a result of those ludicrous contracts, teachers' jobs had to be cut. Is the hon. Gentleman proud of those priorities and the efficiency of that flagship London Labour council?

Mr. Blunkett: I seem to recall that the PA Consulting Group, which investigated the operation of compulsory competitive tendering in the light of the Government's desire to extend CCT, recommended that community and school transport should be exempted on the ground that it was cheaper for the authority to organise its overall services to integrate the provision of school transport with

its central transport operations and that it cost as much money to put the services out to tender as it did to operate those services. I am happy to refute the allegations of the hon. Member for Amber Valley (Mr. Oppenheim).
I have been diverted from the interesting leader article in The Times. The article referred to a speech made by the Minister for Local Government and Inner Cities yesterday to the Association of County Councils about the future. Obviously the future of local government is dependent on and bound up with the ability of local government to raise tax and spend money. The article stated:
For good measure, Mr. Redwood listed some of the activities that a modern Tory minister nowadays associates with subsidiary government in Britain. A county might see its identity reflected in an agricultural show, a cricket team and a lord lieutenant; a town might find expression in a football team, an arts festival and a mayor. Small wonder that councils are frantically campaigning against what they see as another assault on their surviving functions.
There could be any old tax if the functions of an authority were reduced to the point where a council meeting could be held in a telephone box with a taxi or Lewisham's school transport waiting outside to take people away. It is nonsense—we all know that it is—that a tax should not be able to bear the functions and activities which give local people an opportunity to express themselves at the ballot box and to get the services that they want.
Having had the poll tax, one unholy mess, perpetrated upon us, we now have the council tax. The reports offer 75 per cent. of expenditure, as the Under-Secretary of State for the Environment has spelt out—that is, 75 per cent. of CSL's estimate on revenue and the £41 million for England in terms of capital allowances.
My hon. Friend the Member for Birmingham, Selly Oak (Dr. Jones) asked whether the software provision that is absolutely vital in implementing the new proposals could be capitalised to ensure that they did not fall as a revenue charge which would divert from other administrative costs. I hope that the Under-Secretary of State for the Environment and his hon. Friend the Under-Secretary of State for Wales will be able to assure us that such costs can be counted for capital purposes to ensure that further damage is not done to services by having to find revenue from elsewhere, because those things matter greatly and authorities are having to do the planning and the work now. They cannot do them after April next year. They cannot simply put off the evil day or perhaps decide that they will find the expenditure from somewhere else, because they have to do so now. We will deal with capping orders which illustrate the delicate position in which authorities find themselves. Even an extra £3 a head on a poll tax bill has to be denied a tiny district authority in the interests of centralised government and new forms of autocracy.
It would be helpful if the Under-Secretary of State for the Environment and his hon. Friend the Under-Secretary of State for Wales could answer a few questions about exactly what we will have to face in the months ahead so that local government can take account of the problems and begin to plan to overcome them.
The Under-Secretary of State for the Environment suggested that it was not necessary to have a register to be able to operate the council tax; therefore, expenditure did not have to be found—that was the inference—to provide and maintain that register. It is only a week or two since the Government admitted that they will use the poll tax register for the coming year to assess the likely take-up of


discounts and the way in which an authority would have to calculate the amount levied on the new valuation system to reach a base level for funding the authority in the year ahead.
Those are serious matters. If the poll tax register, with all its faults and failings, is to be used for that purpose, why not accept that there should be a maintained register over the years ahead? Why not accept that funding should be made available to sustain such a sensible register?
The Under-Secretary of State for the Environment said that there would be a standard council tax charge and that people would apply for their discounts once they knew what their bills would be. A bill will drop through the door, and the family or person living in the house will have to make an application. But that is a fat lot of use to the authority that is planning for how many people it will have to assess as living alone. It is a fat lot of use in determining exactly how grant, business rate and local council tax revenues are to be balanced to ensure that authorities can balance the books in the financial year ahead. It is a fat lot of use, Mr. Deputy Speaker—[Interruption.] I am sorry, Madam Deputy Speaker. It is a women's takeover. It is necessary to have that information in order to assess levy and the likely problems that will be experienced in dealing with council tax capping and the like.
Some serious issues arise out of the dismissal of a register in terms of the operation of the discount system. I should be grateful if the Under-Secretary of State for the Environment the Under-Secretary of State for Wales would tell us where the cash will come from to compensate for that.
We estimated that £780 million would be necessary to fund the discounts to people living alone. I assume that part of that will be trawled back from the reduction in the amounts claimed in benefits. We were not assured in Committee about that. I referred earlier to why we did not believe that the Government would implement the council tax. They had so few answers to reasonable questions about how the tax would be implemented.
One of our questions was how much it would cost the nation as a whole, or how much would have to be found by local taxpayers, to top up the amount lost by giving discounts to the wealthy who happened to claim that they lived alone. Once such claims are made, it is necessary to check them to ensure that the system works and is properly monitored. Then we are into the business of the register.
We are not sure how the valuation system is working out. We had a bland assurance this afternoon which the civil service had written into the Under-Secretary's speech that all was well on the valuation front. That is not the information or the signals that many of us have received about what is happening on the ground.
My hon. Friend the Member for Normanton (Mr. O'Brien) is one of the world's experts on valuation appeals. In the Committee which considered the poll tax legislation, he enlightened us about the number of outstanding appeals against the former rates and business rates valuations. The figure was 43,000 in West Yorkshire alone. That was only a few months ago. My hon. Friend will confirm, I am sure, by tapping my left leg that I have got it right.
We now face a valuation system that will not be completed until the end of the year. Information will not

be given to authorities and individuals until the beginning of 1993. People will be expected to lodge appeals. You were not in the Chamber to hear it, Madam Deputy Speaker, but the Under-Secretary said that everything would be all right because, to paraphrase, the valuations would be so vague and inaccurate that no one would be able to appeal against them. That is what he said in effect. I thought that that was an interesting give-away.
If we had been able to operate a new property tax, the Labour party would have introduced definite valuations which took account of the real sale price of the house, adjusted by sensible measures. People would have the right to appeal because they would know exactly how their house compared with the neighbour's house or that of the person down the street who lived in slightly different circumstances. But, of course, no one will know that under the council tax valuation.
We can make a pretty good guess about what the valuation may be if a person does not have an extension on the back of the house, does not have a particularly enjoyable vista from the kitchen window or has a gasworks or fish and chip shop next door. I used to use the example of a fish and chip shop until the Secretary of State thought that I was referring to fish and chip shop owners and threatened me with an army of them parading outside the Palace of Westminster. So I shall stick to gasworks from now on.
Who wants a gasworks next door if the house is valued the same as the one that adjoins the local park? Of course, no one does. But presumably the Government believe that they will get away with it if the valuation is sufficiently vague to avoid a successful appeal. It all adds up to a shambles. As my hon. Friend the Member for Normanton reminds me, we had hot air balloons and helicopters passing overhead to take aerial photographs to make sure that people had told the truth about the size of their house and whether they had an extension.
Above all, the grant should ensure that local authorities can do the job well in advance. It is regrettable that a dozen key orders for the preparation and implementation of the council tax are still outstanding. We are only a few months away from D-day—or M-day, because it is a Michael tax rather than a David tax, in every sense of the word.
It is tragic that local government is expected to put the council tax together with so little information at such a late date. We do not know what provisions might be made for the standard spending assessments. We pray and hope that the Government will make some revisions so that authorities have some sense in their expenditure.
We hope for some clarification of the equalisation formula for the new grant structure after the reintroduction of a property tax. We know that at least the Under-Secretary of State understands the problems of equalisation. It was clear that other Ministers did not have a clue what we were talking about when we mentioned it in Committee and elsewhere.
A host of problems face us, and also a belated order before the summer recess, to assure local authorities that there will be some resources to help them to do the job. We should thank local authorities for the way that they are facing up to this further enormous change. We should applaud them for the way that they have tackled what they know to be another flawed tax. Once again we should


accord local government the gratitude that it is so often denied by Conservative Members—gratitude for managing the impossible.
That is what we should be doing. Instead we are reading out briefs to tell local government that it will get 75 per cent. of the cost and that perhaps, under the other services element of the revenue support grant, it might get an unspecified extra 25 per cent. if it is not clawed back by the Treasury in negotiations with the Department of the Environment which amount to a battle to prevent the council tax from degenerating into the shambles that the poll tax was. We know that there is a battle and we know that the Government should spend hundreds of millions of pounds to introduce the tax rather than try to do it on the cheap.
We have no idea what the reduction scheme—the transitional help to protect people on transfer from poll tax to council tax—will cost. Perhaps we could be enlightened about that.
Answers to all those questions would help local government to do its job more effectively and to avoid being blamed when it is the Government's fault for introducing the tax too late, too shambolically, and without the necessary forethought or information to make it work properly.

Mr. Eric Pickles: Ever since I became involved with local government, each time that we have embarked on some new strategy or act, people have said that it was the end of local government as we knew it, and that if we did not get the legislation right, it would all be over. It is true that the credibility of both the Government and local government is on the line with the council tax. Everyone across the political spectrum in local government has a vested interest in ensuring that the tax succeeds.
I have always had an optimistic view of local government and, to a small degree, I share the views of the hon. Member for Sheffield, Brightside (Mr. Blunkett). Local government seems to be able to change its functions and structures quickly, and to absorb new types of finance, which shows how adaptable it is.
Before we pass the grant, it is reasonable to ensure that the amendment is sufficient. As my hon. Friend the Under-Secretary of State for the Environment said, the Government commissioned an independent report and, pleasingly and unusually, accepted its recommendations in full.
Two authorities make up the constituency of Brentwood and Ongar: Brentwood receives £131,000 in grant and Epping Forest receives £223,000. Opposition Members should realise that, on the whole, authorities are satisfied with their grants. Even the Association of Metropolitan Authorities has said that its members are largely happy with the size of the grant. That association is Labour controlled and, although I hold it in the highest regard, it is not renowned as an organisation which regards Government initiatives with any enthusiasm. Although it is not dancing in the aisles, it is satisfied with the sum that is available. It has reservations about whether the grant should be open ended, and I shall consider those later. The grant is intended to cover the sum of money expended.
The valuation process appears to have run smoothly. I do not know what signals Labour Members have been receiving, but it is a remarkable achievement to value 21 million properties by, roughly, the end of this month. It is remarkable that only 1 per cent. of firms performing those valuations were dismissed for repeated inaccuracies. I wish that that had been the case under the rating system, because, then, people would not have come to the House and spoken about the length of appeals. The Government appear to have done the job well.
I am also pleased to hear that the valuations of only 6.3 per cent. of properties were rejected as being inaccurate. That is the figure that we could have expected under the old rating system. I would not have regarded it as unusual if it had risen to 10 per cent. Therefore, it is not surprising that the Valuation Office is prepared to go on the record and state that the exercise has largely been performed satisfactorily.
The real test will come in December and January when the lists of valuations are displayed in town halls. A Labour Member suggested that many appeals might be lodged. It is pleasing to note that he is using slightly gentler language than that behind the ridiculous suggestion that the number of appeals would reach hundreds of thousands. Because of the small difference between the bands, I doubt whether many appeals will be lodged. I suspect that there will be more unhappiness about low valuations than about high ones. People will argue that their property is worth a lot more than the valuer suggests, but unless I am misjudging people's attitudes, I doubt very much whether people will appeal, saying, "Excuse me, but I am in a lower band and I would like to pay more council tax."
According to the spokesman for the Institute of Revenues, Rating and Valuation—an independent organisation—the number of appeals is likely to be minimal. I am sure that that will be the case.

Mr. William O'Brien: Will the hon. Gentleman give way?

Mr. Pickles: I am extremely flattered, and I am delighted to do so.

Mr. O'Brien: We should pursue that point. Perhaps the hon. Gentleman will outline what will happen to the disabled person, who has been assured that he will be put into a lower band, if he is already in the lowest band? Will the hon. Gentleman explain what concession will be given to disabled people who are already in the lowest band?

Mr. Pickles: It is clear from the legislation that for those in the lowest band, particularly the disabled, the necessary adaptations that go to make up the valuation —[Interruption.] I hope that hon. Gentlemen will allow me to answer the point. The substantive point is that adaptations to property, which enable a disabled person to live comfortably and reasonably in a house, are exempt from the valuation. There is no suggestion that higher valuations will be made. Individual and personal exemptions are available, which is perfectly reasonable.
It is spurious to suggest that many appeals will be made.

Mr. William O'Brien: The hon. Gentleman's remarks are highly significant. He has introduced a new subject that we were not allowed to debate in Committee—disregards in the valuation of properties lived in by disabled people. If he is correct about that, I hope that that will be


confirmed, because that point was not made in Committee. We should receive some assurances on the points made by the hon. Gentleman.

Mr. Pickles: I think that the hon. Gentleman has misunderstood what I was saying. I was referring to disabled people in the lowest band. If their properties are adapted, they may face the prospect of being placed in a higher band. My substantive point was that, because of the legislation, those adaptations that increase the value of the property will be ignored when the banding is determined.
Given the way in which the valuation exercise has proceeded and the general satisfaction of various authorities, it is not surprising that Mr. Olding, the director of finance for Brentwood district council, wrote to me:
The introduction of the Council tax in Brentwood is proceeding smoothly and I am confident it will be a similar success story to our record on the Community Charge.
As the Under-Secretary suggested, the council tax will be much simpler to administer than the rates or the community charge. The most important factor about the new system is that it has been market tested and that it is based on valuations. People generally know the value of their home. The new system is not based on what a notional rent should be and, therefore, people will have a much clearer idea of whether they should appeal. The council tax is much easier to understand than the rates or the community charge. We need to make it clear that, because of the banding, the valuations will not be exact. As the director of the Institute of Valuers, Mr. Farrington, recently said, it is an
indication of the relative values against other properties in the same area".
I am pleased that, through the council tax, local councils' ability to raise their own revenue will be retained. That is essential to local democracy. It retains the link between when local government chooses to spend and what residents are prepared to pay. The revenue raised locally relates roughly to the level of discretion. I notice that the hon. Member for Brightside has just left the Chamber, but in a previous organisation, to which we both belonged, I used to listen to his long and persuasive arguments that local government was raising too much money locally and that the balance had shifted. He argued that central Government would have to raise more. The Government have taken his arguments on board and have drastically cut the amount that is raised locally by doing exactly what the hon. Gentleman suggested. He now tells us that we are wrong.
The level of discretion in local councils is roughly between 13 and 15 per cent., so we will have the opportunity to get better and more accountable local government through the introduction of the council tax. If a council decides to exceed its SSA—and it may have good reasons for doing so—local residents will have to pay. I do not want to trespass on the debate that will follow, but residents have the right to be protected when their council runs out of control and spends excessively.

Mr. Bill Olner (Nuneaton): The hon. Gentleman cannot have it both ways. He has spoken about local accountability and local democracy, but it is the Government and their civil servants who set the capping levels that appertain to all local authorities. It is nonsense

to say that local authorities can do what their constituents want. They cannot, because there is a central and overbearing burden put upon them by central Government capping. I have no argument with the disappearance of the poll tax—I do not think that any hon. Member has, including Conservative Members. We are all glad to see the back of it. It is nonsense, however, to talk about the retention of local accountability when capping will still be retained after the introduction of the council tax.

Mr. Pickles: I thank the hon. Gentleman for that comment. However, one of the strengths of the British constitution is, essentially, its pragmatism. When dealing with many councils that are elected on a four-year or "third out" basis, the electorate should be able to give a clear message. They gave us a clear message in April and May this year. There must be safeguards to ensure that individuals are protected. There must not be low increases or even no increases just before elections and then massive increases in the years when the electorate has no opportunity to protest. If the Government stand for anything, they stand for the protection of the individual, and those capping powers are to protect individuals against the excessive abuse of the state.
With careful management and foresight, the grants should be sufficient. The majority of information technology applications should now be in place. However, I was alarmed at a recent survey by the Society of Information Technology Managers, whose bizarre acronym is SOCITM. I have been a recipient of its bills and the acronym may be a reference to its charges. It showed that, at the end of April, only 52 per cent. of councils had signed contracts for information technology. Half of those have gone to outside contractors. Many people blame the uncertainty of the period before the general election, but it is lackadaisical and unacceptable not to have those information technologies in place now.
That brings me back to the point made by the AMA: if the amount of money is not sufficient, should not the Government underwrite that sum? By not having their information technology in place, those councils have effectively cut down their options. All that they can do now is to take proprietary packages, which will be more expensive with regard to adaptation. There should be no open-ended commitment to underwrite all the costs. It is no use complaining that the money is insufficient if councils have not taken the necessary action to minimise damage.
The grant that generates that sum must be sufficient to ensure that those packages can take care of the review of local government, whether local authorities are sized up or sized down. Many charging authorities will have to change in nature. They may be joined by other authorities or disappear completely.
We must still deal with arrears in rates and poll tax payments. The no-pay culture that stalks local government and the Labour party has done considerable damage to local government.

Mr. Paddy Tipping: Will the hon. Gentleman give way?

Mr. Pickles: I fear that Opposition Members feel that I am spending a lot of time on my speech, but if they keep intervening I shall keep going.

Mr. Tipping: I am interested in the notion of a no-pay culture. Will the hon. Gentleman comment on the research in Nottinghamshire that shows that Labour-controlled councils have a far better collection record than Conservative-controlled councils?

Mr. Pickles: I shall come to that matter in due course, because it is germane to the point.
I do not wish to use exaggerated language, but the Frankenstein monster of the no-pay culture, largely created by Labour councils, will haunt them for a long time. It will not be as easy for them to get rid of the monster as it was to allow their CND membership to lapse.
There should be a clear message that there will be no amnesty for defaulting poll tax payers and that those who use a service should be expected to pay. Either through inefficiency or encouragement, Labour-controlled authorities have failed to ensure that people pay their bills. My authority of Epping Forest has a collection rate of 95 per cent., and my authority of Brentwood has a collection rate of 102 per cent.—not because people there want to pay more but because the council has been prepared to ensure that people who have not paid do pay. People in Brentwood and Ongar do not all live on high incomes—plenty of people are on low incomes in my constituency —but they realise that paying the community charge is the law and people on low incomes are prepared to pay because they realise that if they do not, others will have to pay.
Compare that with the top 10 councils with the highest number of defaulters: Hackney with a collection rate of 52 per cent.; Newham with a collection rate of 58.6 per cent.; and Liverpool with a collection rate of 62.3 per cent. That is sheer incompetence.

Mr. Alex Carlile: On a point of order, Madam Deputy Speaker. The hon. Gentleman has been wittering on about matters that have nothing to do with the narrow reports that we are debating. He has now been on his feet since 4.36 pm. Will you return him to order now?

Madam Deputy Speaker (Dame Janet Fookes): I allow a certain latitude in discussion of these matters, but the hon. Member for Brentwood and Ongar (Mr. Pickles) should clearly relate the point that he is now making to the reports under discussion.

Mr. Pickles: Yes, Madam Deputy Speaker. The specific point relating to the reports is the use of the sums of money determined by them. That money must deal, essentially, with three things: first, poll tax defaulters; secondly, rates defaulters; and, thirdly, the introduction of the council tax. But no sensible council should try to use that money in that way. They should abandon rates arrears altogether and regard them as miscellaneous debt, thus making considerable sums available for information technology. They should now put out to competitive tender the collection of community charge non-payments, allowing revenue staff to work exclusively on the introduction of the council tax. The licensing of software could then be shared by those who contract out and space could be rented in software houses. That is a much more sensible way to proceed. It is not an ideological point, but a pragmatic and sensible one.
We employed extra staff for the introduction of the community charge, and those people know that they are not needed and that they must therefore go. Rather than

keeping a dispirited staff together, it makes much more sense and is a better use of public money to contract the work out.
I am pleased that we shall use the electoral register. Now that we are adopting a system in which the applicant must prove, we should not be blind to other information available. The community charge register already exists. Just because we shall no longer apply that charge, it does not mean that we should not use the register for it. Why not use the electoral register, which exists as a method of proof? There is no need for a separate council tax register, and arguments for one are spurious.
In conclusion—[HON. MEMBERS: "At last."] Those hon. Members who wish to make speeches should not have interrupted me. The sums of money offered are reasonable, and local income tax will come out stronger from that process.

Mr. Alex Carlile: I shall depart from the line adopted by the hon. Member for Brentwood and Ongar (Mr. Pickles) and concentrate on the issue underlying the provisions. In most fairy tales or cautionary tales, goodness and morality win in the end; but this is a bit like a bad fairy tale, where badness and amorality win. It is as if a wicked witch in a lair on a central London street had mixed a magic potion called the poll tax and told everyone that they had to use it. Later, when it was realised that it was a thoroughly bad thing, along came a fairy godmother called Michael, his long, blond hair a-sparkle with magic charms, with a solution called the council tax. In the real fairy tale, goodness and morality would win to the extent that those who were good and deserved to have justice on their side would receive it free.
However, in the case of the council tax, the Government handed over the transfer process to a perfectly competent firm of consultants for whom they wrote a brief. The consultants drew up a report with recommendations that the Government accepted in full —I recognise that. But the bottom line is that up to 25 per cent. of the revenue cost of switching from the poll tax to the council tax may have to be borne by the local taxpayers in each district of England and Wales.

Mr. Elfyn Llwyd: I was astonished to hear the hon. Member for Brentwood and Ongar (Mr. Pickles) say that there was overall satisfaction with the level of grant available. That is complete and utter nonsense. I have spoken to treasurers in both the districts in my constituency. In one case it is estimated that a sheer moiety of the grant will be payable—it will be 50 per cent. short. In the other case, the amount is about 45 per cent. Therefore, how the hon. Member for Brentwood and Ongar could make that assertion is beyond my comprehension. In any event, the mistake is central Government's and they should sort it out and fund their solution properly.

Mr. Carlile: I am grateful to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) who, unlike the hon. Member for Brentwood and Ongar, has stayed, fought and won in his community, where he is closely in touch with the views of both councillors and local government officers and has been for the past 20 or so years. He underlines my point that, in every district council area throughout England and Wales, residents in the local


community will have to find money from their own pockets to meet the shortfall. The Parliamentary Under-Secretary of State shakes his head, but the Government have not undertaken to meet the revenue cost in full. If he wants to deny that, I shall give way with pleasure.

Mr. Squire: I was endeavouring not to interrupt the hon. and learned Gentleman's flow, but over and above today's report, the Government have undertaken to contribute substantial funds to the revenue support grant. The matter is not quite as black and white as the hon. and learned Gentleman makes out.

Mr. Carlile: The Minister has, by implication, confirmed what I said earlier. I chose my words carefully and said that the consequence of the policy was that up to 25 per cent. of the revenue costs of the change may have to be met by local taxpayers. Nothing that the Minister has said so far would change that—and I suspect that nothing that the Parliamentary Under-Secretary of State for Wales says later will do so either.

Mr. David Congdon: Will the hon. and learned Gentleman give way?

Mr. Carlile: No, I shall not give way as many other hon. Members want to speak.
The Government introduced the poll tax, which was nearly a complete political disaster for them and which has been accepted as being a mistake in tax terms. However, they have not done the decent thing and said that they will meet in full the cost of putting right their mistake.
In rural districts such as the constituency that I represent, Montgomery, and those of the hon. Members for Meirionnydd Nant Conwy and for Hemsworth (Mr. Enright), even a shortfall of a few thousand pounds will have tangible effects on the local community. For example, it may mean that small businesses will have to pay more for refuse collection and council houses will be maintained less efficiently than before.
I am sure that I speak for almost all my constituents when I say that I see no justice in me or any other taxpayer in Montgomeryshire having to pay a penny piece to put right a horrible mistake by the Government. I certainly regard it as outrageous that there should be a reduction in local services as a consequence of that mistake.
The matter extends further than the simple question of how to meet the cost of introducing the council tax. The poll tax will continue to haunt local councils while they attempt to collect unpaid poll tax. As I understand it, the orders make no allowance for the continuing cost of trying to collect the unpaid sums—a process that could continue for a long time. It has already wasted a tremendous amount of court time and money, and in some districts only a small amount of tax has been collected.
I hope that the Government will feel that, as they are not providing either a grant or an interest-free loan for the collection of outstanding poll tax, they will eventually say, "Enough is enough—we should stop our futile task of trying to collect the poll tax, which is now a residual sum that can never be collected." That time may well not yet have come, but I hope that the Government keep the matter under constant review. When the Parliamentary Under-Secretary of State for Wales replies, will he

repudiate the suggestion that I believe was made by the hon. Member for Brentwood and Ongar that the last drop of poll tax should be collected, no matter how much it may cost local authorities to do so.
The figures set out in the orders seem to show anomalies between local authorities. For example, Richmond upon Thames has 64,400 households and a population of 167,200, and receives £340,000 grant; Kensington and Chelsea has 7,000 fewer households, 36,000 fewer people, and receives £61,000 more in grant. Bearing in mind that the grant structure for the whole country is supposed to be based on inner London figures, such anomalies are causing concern among local authorities and I make a genuine plea for information on how such anomalies have arisen.
Above all, however, England and Wales people are waiting with me for the Government to tell us why they should pay anything for the Government's mistakes.

Mrs. Angela Knight: My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) said that he was sure that all parties wanted the introduction of the council tax, and for that tax to succeed. Judging from the contributions that I have heard from Opposition Members, I wonder whether they truly want the council tax to succeed.
The grants that we are being asked to discuss and agree today are to be used for the implementation of the council tax. In the few weeks that I have been a Member of Parliament I have learnt that if people are really concerned about an issue the first thing they do is to write to their Member of Parliament. I have received no letters from constituents about the introduction of the council tax and I have had no representations from my local authority. Most of the local authorities appear to be satisfied with the amount that we are being asked to grant to them. I trust that the £184,000 for Erewash will be used properly for the purpose for which it is intended.
I am sorry that the hon. Member for Sheffield, Brightside (Mr. Blunkett) has left the Chamber. The hon. Gentleman said that local authority finance was a shambles. I spent five years as a member of Sheffield city council when the hon. Gentleman and the hon. Member for Sheffield, Attercliffe (Mr. Betts) were its leaders. If I had to attribute the word shambles to anything I would use it in connection with the way that that council was run, then and now.
There is a sad inevitability about the way that Labour councils are run, as those of us who have lived or still live in areas run by them are well aware. I had that experience not only as a member of Sheffield city council but as a resident in the area run by Derbyshire county council, which is notorious for the way in which it governs the area. Opposition Members mocked the Minister who said that counties should not just be known only by a cricket team. Derbyshire cricket team does the county far more credit than its council.
A recent article in Tribune, commenting on the local council elections, stated that several of the councils in which Labour fared worst did not deserve to do any better simply on the basis of Labour's dire record in office. I have seen the truth of that statement at first hand. I am glad to see that the hon. Member for Brightside has returned to his place.

Mr. Blunkett: The hon. Lady and I have crossed swords in the distant past. She speaks about competence. What did the Audit Commission say in 1985 about the running of Sheffield city council when I was its leader? Will she confirm that the chairman of the Audit Commission at the time, who is now taking over the Local Government Commission, said that Sheffield was a shining example and the most efficient council in Britain? Will she also confirm that for the first time in history Labour won the Broomhill ward in the Hallam constituency in July 1985 at the height of the conflict with central Government?

Mrs. Knight: The hon. Gentleman has since lost the Broomhill ward not just once but twice. Perhaps there was one occasion on which Sheffield did not do everything wrong. However, I urge him to look at the reports for successive years on Sheffield city council by the district auditor and the Audit Commission. The hon. Gentleman should submit his evidence to the current inquiry by the district auditor into the World student games and the overall running of the local authority. For such reasons I welcome the council tax.
I have heard much concern expressed about the alternatives proposed by other parties. Rates have been mentioned, but my constituents are loath to have any sort of return to the rates. Mention has been made of the business rate. The business communities in the midlands, the north and Sheffield are united in their opposition to a return to a system in which the rate is set by the local authority. If Opposition Members spoke to their chambers of commerce, they would find, as I have, that that is their view.
Accountability is surely fundamental to local government. There must be a direct link between the amount that people pay and the implementation of the policies for which they voted. That link is retained in the council tax. I welcome the fact that people have recently started to pay great attention to local government. The council tax will be most acceptable to my constituents, but there is still a need to ensure that bills are correct and fair and are seen to be reasonable. A system under which people will not examine so much how we pay for local government will enable them to pay more attention to what local government is doing and the services that it provides. There is great concern in Derbyshire about that. One of the worries relates to the funding of Derbyshire police force and the report—

Madam Deputy Speaker: Order. I am sorry to interrupt the hon. Lady, but it is clear that her speech is straying wide of the subject of the debate. She must relate more closely to the order, which is fairly narrow.

Mrs. Knight: The order deals with the granting of public money to local authorities. We are asking those authorities to spend that money wisely and advisedly. I am addressing that and the concern of many of my constituents about the use of public money and the services that are provided.

Madam Deputy Speaker: Order. I remind the hon. Lady that the public money that we are discussing is for the introduction of the new tax.

Mrs. Knight: The council tax will lead to greater accountability because it will bring greater fairness, awareness and equity to local government finance. I am addressing those issues, which are surely important to all

hon. Members. It is important for the grants to be made and for the council tax regime to be implemented so that equipment can be bought and wheels set in motion. The new tax must be introduced fairly and on time.
The fairness of local government finance is also a subject for debate. The unfairnesses in many local authorities such as mine are practised in what is called the name of the people. Those councils have not provided the services that people want. They have not funded the police in the way that people want. I understand that this is a narrow debate.

Madam Deputy Speaker: Order. I am sorry to interrupt the hon. Lady again. I have no doubt that the matters that she is raising are important to her, but they do not fall within the scope of the debate.

Mrs. Knight: Thank you, Madam Deputy Speaker.
I applaud local government. I applaud many local councils for the efforts that they have made to ensure that services are delivered in the areas for which they are responsible. I applaud them for the efforts that they have continued to make during times of change, and we must change the ways in which local authorities are financed. Unfortunately, I cannot applaud all local authorities or councils, and some of the worst are those that are ruled by the Labour party.

Mr. George Howarth: I shall try to keep my remarks strictly within the terms of the orders.
The two most recent speeches that we have heard from the Government Benches had a profoundly depressing ring about them. The hon. Member for Brentwood and Ongar (Mr. Pickles), having failed to maintain control of Bradford city council for the Conservative party, decamped to another part of the country. He chooses now to use his seat in the House to berate local government in general and the part of it that would not continue to elect him in particular.
The same can be said of the hon. Member for Erewash (Mrs. Knight). Having failed on any occasion to take control of Sheffield city council, the hon. Lady decamped to Derbyshire. Having failed to listen to your strictures, Madam Deputy Speaker, she is now failing to follow the debate, but that is probably par for the course. It seems that she prefers to talk to her colleagues.

Madam Deputy Speaker: Order. I think it unwise for one Member to talk about the conduct of another. There is some unbecoming conduct in the Chamber, and I refer to the amount of conversation that appears to be taking place among those on the Opposition Benches. I am anxious to hear what the hon. Member says.

Mr. Howarth: I am grateful to you, Madam Deputy Speaker.
I wish to say specifically that, having failed ever to take control of Sheffield city council, the hon. Member for Erewash had to find a seat that could accommodate her in Derbyshire. From that safe warren the hon. Lady attacks the city council of which she used to be a member and of which she could never take control.
The hon. Members for Brentwood and Ongar and for Erewash, having been rejected by their local authorities,


have come to the House to turn the full heat of their hatred back on the electorate. It seems that it is to be punished for not electing them at local authority level.
I wish to talk specifically about the application of the council tax in Knowsley, part of which I am proud to represent. The first issue that I intend to raise was covered in part by my hon. Friend the Member for Normanton (Mr. O'Brien), when he intervened in the Minister's speech. I am concerned about how the council tax will bear on those whose properties have been adapted because of their disabilities. I spoke to officials of Knowsley borough council this morning, who told me that they are desperately concerned about the way in which the system will operate. They feel that it will be difficult to ensure that adapted properties are subject to appropriate banding. It seems that the onus has been placed on local authorities to seek out disabled people. The officials to whom I spoke feel that that is not necessarily the best approach. More to the point, they feel that there is much scope for disabled people being overlooked. Another consideration is that if a property is already on the lowest band and then it is adapted, there is no further band to which it can drop. That discriminates against those who live in properties that fall within the lowest band. There is no scope there for any improvement.
My second complaint is that the discount system seems incredibly difficult to operate. The onus is on the local authority to identify who is and who is not a single-person occupier. It seems that the Department of the Environment takes the view that the benefit of the doubt rests with the council tax payer. That is the advice that is being received by local authorities through the Department. I understand, however, that a recent Audit Commission circular states that the onus is on the occupier to establish his or her status as a single occupier. It seems that the Audit Commission has made that clear in recent contacts with local authorities. There is an area of confusion which needs to be clarified.
If I thought that informative circulars and guidelines were to be issued within the next few days or weeks, that would be all right. Unfortunately, that seems not to be the position. I was told this morning by officials of Knowsley borough council that, apart from the relevant legislation, only three practice notes have been issued. The practitioners feel that there are huge grey areas and overlapping confusion that still has to be cleared up. A vast amount of additional information will have to be made available if the practitioners are to be able to sort out the proposed system in time for its implementation.
I went some of the way with the hon. and learned Member for Montgomery (Mr. Carlile) when he made his measured remarks about non-payment and the aftermath of it. I do not think that any of my hon. Friends ever advocated non-payment. It was—[Interruption.] We never did. There were a couple of Members who did so, and it may have escaped the notice of some Conservative Members that they are no longer Members. The two things may not be entirely unconnected. Apart from a minority, my colleagues in the Labour party—in the House and elsewhere—were careful not to advocate non-payment. The problem arose—the Government were warned about

this—because of the uncollectable nature of the poll tax. My colleagues and I never advocated the non-payment culture, a term which Ministers seem intent on using.
The local authority in my constituency and other Labour authorities throughout the country have taken determined measures to recover the tax that has not been paid. There must come a point, however—I do not know whether we have arrived at it yet—when the law of diminishing returns starts to operate. Local authorities are expected to pump in resources to collect sums that may prove to be uncollectable. The cost to the local authorities may outweigh whatever it is able to recover. I am not saying that recovery should not be sought where a person who should have paid the tax is clearly identifiable. There should not be a general amnesty, but perhaps there should be a more intelligent approach. Perhaps there should be greater co-operation between central Government and local government to decide what is reasonable and what is not in determining whether those who should have paid poll tax and have not should be pursued, and for how much longer.
The hon. and learned Member for Montgomery raised a matter that should be given thoughtful consideration by the Government. I hope that I have made it clear that we should adopt a measured approach to the problem. I am not advocating any wild action.
The council tax is an improvement on the poll tax. It would be miraculous if even this Government could come up with anything less acceptable than the poll tax. However, despite all their claims, the council tax is still not the best solution for the financing of local government. The test should be whether the tax will be with us for at least a generation. I believe that a future Government of another persuasion, or the present Government, will have to return to local government finance legislation, possibly annually. Indeed, that seems to have happened over the past 13 years or so. The Government do not have the right formula and the tax does not reflect the necessary balances. There is a need for accountability and there is a need for central Government to be able to adjust the formula to compensate for the different levels of poverty, for example, that are to be found in different areas.
I regret the fact that these reports make no contribution towards a long-term consensus on financing local government. The Government know that that is so. The pity of it is that they have been unwilling to consider a long-term solution. Instead, they have tried to find a short-term solution that will dig them out of a hole. It does not, however, provide a solution to the long-term problem.

Mr. David Congdon: I had not intended to make this point, but, having heard the point made by Opposition Members about community charge arrears, I really do think that local authorities must make every effort to collect them. One of the biggest complaints that constituents make to me is the additional amount that is added to their community charge bill because others have not paid their community charge. We know that under the old rating system people had to pay for those who did not pay the rates, but that was not visible. It was the visibility of the community charge which caused so much resentment. It is very important, therefore, to collect it.
The new council tax will be much fairer than the community charge. As a member of a local authority for 16 years and chairman of Croydon's finance committee for six years, I was pleased to play a part in that authority's efforts to ensure that the community charge was collected properly and efficiently. Many authorities decided not to do so but to make the biggest mess that they could of it and then to complain when they were unable to collect the amounts demanded. It is imperative that all local authorities do their best to collect the council tax. That is why I welcome the reports. They provide a proper basis for local authorities to set in train the procedures, computer systems and so on that are needed to collect the new council tax.
It is easy to argue that the Government ought to make more money available. I am not convinced that the Government ought to fund the full cost to local authorities. That would provide no incentive for authorities to ensure that they collect the council tax efficiently. It is too easy to say, "We need another 30 staff here and another 40 staff there if we are to collect the new tax." The truth, however, is that the new tax can be properly collected if efficient systems are set up. It can be collected for an amount significantly less than that which is needed to collect the community charge. Therefore, I welcome the proposals contained in the reports.
The hon. and learned Member for Montgomery (Mr. Carlile) suggested that the Government ought to pay more towards the cost, but where does the Government's money come from? It comes, in any event, from the taxpayer. It is taken from either one pocket or another.

Mr. Alex Carlile: That is a bogus argument.

Mr. Congdon: It is not a bogus argument. The Government have no money of their own. They have to raise money. The problem with some Opposition Members is that they seem to think that the Government's money grows on trees. It does not. We have to exercise proper control over the nation's finances. We ought not to tax people any more than is needed. It is right to set targets for local government by making sure that central Government pays only a percentage of the cost. My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) said that most local authorities believe that the amounts that have been provided by the Government are fair and offer the proper way forward.
I have already said that I believe that the council tax will be easier to collect. There will be no need to have a council tax register. Opposition Members have repeatedly suggested that there will have to be a register. One reason for that suggestion is that they want to demonstrate that the council tax will be very difficult to collect. I have no doubt that one or two authorities will be determined to demonstrate that it is very difficult to collect, but there is absolutely no reason why it should be difficult to collect. I believe that the people of this country will judge it to be a fair tax and that it will prove to be easy to collect.
Fewer people will pay the council tax. That will make it easier to collect. There is no minimum 20 per cent. payment by everybody. Students will be exempt—

Madam Deputy Speaker: Order. I hope that the hon. Gentleman will not go too far down that path. As I said earlier to another hon. Member, we are not debating the principles of the council tax.

Mr. Congdon: Thank you, Madam Deputy Speaker. I was trying to demonstrate that, because the council tax will be easier to administer, the amount required to collect it will be reasonable. The computer systems that will be needed will not be so costly. Fewer staff will be required, because not so many people will be paying the council tax. There will be a bonus for local authorities, for in future the revenue cost of administering the local tax will be significantly less than that required to administer the community charge. We ought not to forget that point when we consider the funds that are to be made available to local authorities by means of these reports.
This is the right way forward. The reports provide for sensible levels of funding. Some local authorities will complain that it is not sufficient to meet their needs. The challenge for them is to demonstrate to their local council tax payers that their proposals for collecting the tax in their area are reasonable, fair and efficient. These reports should enable them to do so at minimum cost.

Mr. George Stevenson: The Minister said that these reports will enable local authorities to prepare for the introduction of the council tax. That statement may be consistent with the political convenience by means of which the Government hope to extricate themselves from the mess that they have created in terms of local government finance. However, it will add to the confusion of many of my constituents and, I suspect, will add to the confusion of many people throughout the country. Having listened to the speech of the hon. Member for Brentwood and Ongar (Mr. Pickles), I suggest that the Government may find themselves in a right old pickle.
Confusion grows on account of the fact that we are told that the council tax will be fairer and will be understood by everybody. I wonder. Recent reports suggest that no less a person than the Prime Minister is concerned about the effects of the Government's community care policy on the council tax. No Conservative Member referred to that, although between £500 million and £600 million will be required to implement that policy—if it ever is put into effect.
Confusion still reigns over the poll tax register. I am trying to be fair when I say that many hon. Members in all parts of the House have local government experience and know how difficult the situation is. Misleading and controversial statements are not what we require if we are to be clear about the Government's proposals.
It has been stated that the poll tax register will not be required. Before I became a Member of Parliament I read ministerial reports that suggested that if local authorities thought that they were going to use the poll tax register they were sadly mistaken; it would not be required and they should not use it. The same Ministers now say that the poll tax register will have to be used. However, some Conservative Members have said that there will be no need to use it. What are the Government saying? My constituents will want to know what they are saying. People throughout the country and local authorities throughout the country will also want to know exactly where the Government stand when it comes to the poll tax register.
It is clear that if the reports determine the basis of local authorities' expenditure, and if there is an individual input, a register will be required. In spite of what has been said


and in spite of the denials, I submit that the poll tax register is the one that will be required. My constituents will want to know what it will cost. We have heard that it will be cheaper, but I suppose that anything would be cheaper than the poll tax, so the cost depends on the criteria on which the Government have based their conclusions. It occurs to me that if an organisation other than the Government were making such proposals and trying to maintain a sense of credibility while suggesting that they would be cheaper, it would be laughed out of court by the Government themselves. We should take what the Government are saying with a large pinch of salt.
The confusion is increased by the valuation process. I do not know how Ministers view it, but I shall respectfully suggest how my constituents view it. They have a picture in their minds of anonymous people wandering the streets, having a look at properties but not going inside or consulting anyone. They envisage those people then placing a valuation on a property and extending it to a number of properties in the same area. We are asked to believe that such an innocuous and ambiguous system— carried out by anonymous people using subjective rather than precise judgements, as the Government and the hon. Member for Brentwood and Ongar admitted—will reduce the number of appeals. Conservative hon. Members will know—

Mr. Roy Thomason: rose—

Madam Deputy Speaker: Order. Before the hon. Gentleman gives way, may I point out to him that he is beginning to debate the merits or otherwise of the council tax, whereas we are considering the funding of the changeover to the council tax.

Mr. Stevenson: I am grateful, Madam Deputy Speaker. I shall give way if it is in order to do so on a point which you have ruled out of order.

Mr. Thomason: I am responding to a point that the hon. Member for Stoke-on-Trent, South (Mr. Stevenson) made a moment ago, so I may be out of order. I was going to ask in what way he thought the Labour party's proposals, involving a formula with four different methods of valuing a property, were an improvement on the Government's proposals.

Madam Deputy Speaker: I advise the hon. Member for Stoke-on-Trent, South (Mr. Stevenson) not to pursue that point.

Mr. Stevenson: I am grateful for your advice, Madam Deputy Speaker, because you have saved me the trouble of answering that question.
We were told that £156.1 million will be available for the introduction of the council tax—75 per cent. to come from the Government and 25 per cent. from local authorities. I had intended to emphasise the fact that that will be an extra unfair burden on local authorities, but many hon. Members have said the same thing so I shall not take up the House's time by repeating it. However, it is important to underline other elements that were mentioned by the Minister when he spoke of the ability of local authorities to meet additional expenditure.
First, we are talking about local authorities that have consistently been subject to cuts in Government

expenditure. The Government should take that fact into account. Secondly, as I understand the system, supplementary credit approvals may be available to local authorities in certain circumstances after the event. In other words, local authorities will have to find the money by borrowing or by some other means and only then might they receive supplementary credit approvals from the Government. That is hardly a realistic way for the Government to encourage local authorities to fund the changes. I urge the Government, even at this stage, to examine carefully the system of supplementary approvals so that it can be made to assist local authorities to meet the requirements of the introduction of the council tax. It is not good enough for the Government to say that there is a possiblilty that supplementary approvals may be available when, on the day and at the time the resources are required, they are not available. That is hypocritical and will not deal with the problems that local authorities will face.
I look at you, Madam Deputy Speaker, with fear and trepidation because I am about to refer to a crucial factor. It has been mentioned, although not in detail, so I hope that you will give me sufficient licence. I wish to mention the way in which the resources for the introduction of the council tax are tied to the overall standard spending assessments. It is nonsense to think that one can pigeonhole such resources or expenditure without considering the total sum that the Government are making available to local authorities, because they are closely interlinked.
I offer an example of how unfair and discriminatory the SSAs have been. The report states that the boroughs of Wandsworth and Westminster are likely to receive about £500,000 from the Government for the introduction of the council tax whereas my city of Stoke-on-Trent is likely to receive £432,000. I am not surprised that Stoke-on-Trent is likely to receive less because if it received 58 per cent. of what Wandsworth and Westminster receive in SSAs, it would not have to levy a poll tax—and that is a good Labour authority.
We must examine how the Government are applying the formula for the introduction of the council tax. If the formula is as discriminatory as the SSAs, local authorities —I suspect that they will be mainly Labour-controlled authorities—will be in greater difficulty, as a result not of their inefficiency but of the Government's discrimination. [Interruption.] I hear the hon. Member for Erewash (Mrs. Knight) whispering to her hon. Friend the Member for Croydon, North-East (Mr. Congdon), to whom I give way.

Mr. Congdon: The hon. Member for Stoke-on-Trent, South (Mr. Stevenson) says that the proposals will favour Conservative authorities. How does he explain the fact that authorities such as Lambeth, Lewisham and Southwark benefit considerably simply because they are inner-London authorities?

Mr. Stevenson: If the hon. Gentleman examines the proposals as a whole he will see that a different picture emerges—it is a system as discriminatory as the SSAs. He did not challenge the example that I gave of my local Labour-controlled authority being so heavily discriminated against in terms of the SSAs, and nor did he challenge my contention that the attitude behind the SSAs is


absolutely critical to our consideration today. I make that point to urge the Government to look carefully at that relationship.
I suppose that anything that replaces the poll tax must be welcome; nothing could be worse. However, in presenting the reports the Government are trying to give the impression that local authorities are to blame for the present situation. They are laying out the ground to try to convince the public to give local authorities the blame again if the council tax does not work—and it certainly will not work. That is disingenuous and does not relate to the Government's mishandling of local government finance over the past decade. I hope that the public will take note of what we say and will not be taken in by the Government's attempt to ensure that if the council tax creates problems it will be someone else's fault, not theirs.
I hope that the Government's attitude to the introduction of the council tax will give more encouragement than the Under-Secretary of State, the hon. Member for Hornchurch (Mr. Squire), gave us. I was staggered by his complacent attitude when he said that the Government were aware how important the subject was, and of the problems that local government might face—and then said what they were doing about that. Ministers visited 30 local authorities. Big deal! Wowee! Blimey! I wonder which authorities those were, and what their representatives said to Ministers. I hope that the Government will have a more positive approach to the subject than Ministers have so far shown.
Apparently, visiting authorities—no fewer than 30 of them—was not the only thing that the Government were doing. They were organising seminars, too, so that Ministers could go round the country telling intransigent, irresponsible, ineffective, inefficient local authorities how good poll tax mark 2 would be. I hope that the Government will show a more positive and constructive approach to the subject than that.
Local authorities need to know that the council tax will not be implemented at their cost. That tax is a reaction to the mess that the Government created with the poll tax, so the Government should shoulder the responsibility, and not seek to blame local authorities for their own incompetence.

Mr. Michael Bates: I have been interested to see a certain amount of hand-washing going on among the Opposition. They are quick to take the credit when things go well with their councils, but as soon as league tables are produced showing how clever or otherwise councils have been about bringing in the money, they seem to wash their hands of all responsibility. They claim that that is not their problem but results from the Government's under-resourcing. That seems to be the knee-jerk socialist reaction. Whenever socialists see a table of grants available, they immediately scream for more to be able to do their jobs properly. In contrast, the culture that Conservatives are trying to create means that we are concerned not with the money coming in but with the services going out. I shall focus my attention on that.
If the grants are to be made for the implementation of the council tax, which we all support—Langbaurgh is to get £245,000, and Middlesbrough £243,000—it is right to ask what value for money people in those areas will get for those sums. That is a fair question. The last time that such

special grants were made they were to assist with the introduction of the community charge. Councils said, "Give us the money; give us the resources. We shall introduce high technology, and collect the charge." Clearly they have failed in that objective. How many councils have failed to deliver?
My hon. Friend the Member for Erewash (Mrs. Knight) said that her postbag was not bulging with questions about the council tax, but perhaps it was bulging with letters from people wrongly accused of not paying the community charge, or people who have not been asked to pay. The information technology systems in place do not seem to offer value for money. I suggest that one way round the difficulties in which some Labour councils find themselves would be to go back to the suppliers of the information technology software and ask for a discount on the basis that its performance in dealing with the community charge over the past five years has not been too grand.
We need to focus on one key factor—accountability. That is what is needed in local government, and we seek to introduce it. To achieve accountability, a system needs to be easily understood. I am amazed at the nostalgia for the rating system. Hon. Members talk about complications, and claim that people cannot understand the capital value of their homes. Of course people understand that; it is manifestly easy to understand. Do the Opposition claim that people understood the system for calculating the rates —that notional system of applying some multiple to a rent that had been calculated for 1973? Of course people did not understand it. That is one reason why we introduced the community charge. People understood a flat rate charge for local services. That is why we are introducing the council tax, which is a further improvement, and an attempt to create even more accountability. It is important that we get that message across.

Mr. Stevenson: rose—

Mr. Bates: No, I shall not give way, because I want to develop my argument a little further, if I can.

Madam Deputy Speaker: Order. I am not sure that the hon. Gentleman can, as he seems to be going wide of the subject under consideration. I have made that point before. The hon. Gentleman must look more closely at the reports.

Mr. Bates: I shall certainly bear those points in mind, Madam Deputy Speaker. However, given the amounts of money in the grants that will go towards the purchase of equipment to assist the smooth transition to the council tax, it is fair to examine the effectiveness of the staff and technology which is in place to run the community charge. Clearly, when 30 per cent. of the community charge for Langbaurgh remains uncollected, the system is not a great success—it costs individual charge payers an average of £37 each. That is why it is right to introduce the system that makes people aware of that fact, setting out on the charge bill the sum that people have to pay because other people sought to evade their responsibilities.
The Opposition have given assurances that there is no campaign to support non-payment, yet they will understand that there is a certain scepticism about that. The fact that 27 to 30 Labour Members of Parliament have yet to pay their full community charge is hardly a lesson or


an encouragement to people to pay their full contribution for local services. It is shoving the burden and the responsibilty on to somebody else—a familiar tack.
That behaviour has not been accepted. The record was the subject of some elections in Langbaurgh last week. I am delighted to see that the hon. Member for Redcar (Ms. Mowlam) is present. I am sure that she, too, recognises the tremendous achievement of the two Conservative councillors who, by taking over Labour seats, returned a formerly Labour-controlled authority to an absence of overall control—if, that is, there can be said to be any real difference between an absence of overall control and Labour control.

Ms. Marjorie Mowlam: No one welcomes a hung council, which presents additional problems of administration and management. I agree with the hon. Gentleman that the current high rate of non-payment and uncollectability of poll tax in Langbaurgh is unacceptable and does no service to the people, but will he tell us why that position exists? Is he saying that local government officers are incompetent? What is his explanation of this serious problem?

Mr. Bates: I am happy to answer that question. Should an authority claim that the collection of community charge is someone else's responsibility, or should it accept responsibility for the task? I think that, if an authority has been put in place to provide services and therefore to collect revenue, that authority is accountable for the collection of community charge. The chairman of the council and the leader of the ruling group are responsible for directing the council.
I can offer some sympathy to Langbaurgh on one ground: only 109 per cent. of the money paid to the district council stays there, because 90 per cent. is passed on to Cleveland county council. People feel that they are not directly accountable for the moneys that are raised and spent simply because they do not see the correlation between what is paid to Langbaurgh and the services provided by Cleveland.

Madam Deputy Speaker: Order. I fear that the hon. Gentleman has forgotten all about the report.

Mr. Bates: I am merely responding diligently to Opposition interventions, Madam Deputy Speaker.
The council tax is fair. To say that the grants are not sufficient is a knee-jerk reaction—a washing of hands and a cop-out. The amounts involved represent huge investments on behalf of the British taxpayer, and the British taxpayer will demand results.

Mr. Rhodri Morgan: I shall try to adhere more closely than other hon. Members to the strictures that you have placed on them, Madam Deputy Speaker, and relate my comments directly to the reports that we are discussing. I believe that I am the first Welsh Member to speak today—or, at any rate, the first Welsh Opposition Member.

Mr. Alex Carlile: No.

Mr. Morgan: Well, I am the first Welsh Labour Member to speak. Anyway, I wish to concentrate on the Special Grant Report (Wales).
The position of Wales in respect of central Government funding has always been different from that of England. The hon. Member for Langbaurgh (Mr. Bates) said that people did not understand the old rating system, but that is not really true of Wales. When Wales was subject to a rateable value-based system, the low capital values in the area clearly required a larger Government contribution to bring the quality of services up to the required England-and-Wales average. Under the poll-tax system, there was no formula that people could easily grasp as they grasped the link between lower property values and a larger Government contribution. A sword of Damocles was poised over Welsh local government finance: the only basis on which Wales could expect a larger contribution from central Government was the previous system.
Now, five years later, we find ourselves entering a second transitional phase. It can be seen from the figures included in the two reports that Wales needs a larger Government contribution to provide the same average level of services as we begin to return to a property-based —or semi-property-based—formula, including a new banding system.
In terms of property valuation, Wales is a different world. The Welsh do not move around so much; they do not expect to market their houses and thus to establish high property values, which makes a property-based local finance system very tricky. Let me illustrate that by means of an anecdote. I recall, in my younger and fitter days, running a half-marathon in the Cynon valley, which has perhaps the lowest average property values in the United Kingdom. At the halfway point I crossed the river and ran up the Mountain Ash side of the valley. As I crossed the river in a state of fearful exhaustion, a dogleg in the road revealed a house directly in front of me. A sign on it read "Asbestos prefab for sale: apply within".
Where in Brentwood and Ongar could such a simple description of a property asset be found? No marketing techniques taught at Harvard business school would be needed to extract the best price for such a house; if it is an asbestos pre-Fab, the vendor should say as much. He will thus secure a quick sale, perhaps within a couple of days. That house may have been of better quality than others in the area, but, in any event, properties are sold for £1,000 or £1,500 in parts of Wales. It is an entirely different world —which is why Wales still needs a larger Government contribution than England during the transitional period. I trust that the 90 per cent. contribution that obtained under the rating system will be returned under the new property-based system, although it became hard to justify under the poll tax. I hope that the Minister will give us a guarantee to that effect; otherwise, the level of services will fall.
The other problems involved have been mentioned many times, and, of course, they affect my constituents enormously. Morale is low in local authority treasurers' departments. They have invested in computers and staff training, and have got the magistrates courts tuned up to deal with the uncollectability of the poll tax. Now, suddenly, the Government are trying to approve transitional expenditure and to return to property valuation, albeit with a banding system, and all that work has been thrown into reverse. The magistrates courts have been told that they can go on short time in a couple of


years, once the hangover of five years of the poll tax has been dealt with—five years of perhaps the biggest single mistake that any post-war Government have made: the Tory groundnuts scheme multiplied by 10. I suppose that that is what historians will refer to the poll tax fiasco as —if you do not mind my finishing a sentence with a preposition, Madam Deputy Speaker; I half expected to see you rise at that point.
The worst thing of all about the yo-yoing from property tax to head-based tax back to property-based tax with banding is the effect that it has had on our democracy. I shall not go into detail, but it is especially true in constituencies such as mine with large inner-city populations, numerous bedsits, a high turnover of rented accommodation and many people on social security living in bed and breakfast accommodation. Where turnover is high, many people have been lost from the electoral register, and that must have an adverse effect on the health of our democracy. I am sure that, whatever your doubts about its relevance to the reports, Madam Deputy Speaker, you will agree with the proposition that our first job as Members of Parliament must be to defend the efficacy of British democracy. The poll tax fiasco has done more to damage that than anything else that has been done in the past 100 years.

Mr. Michael Stephen: I have listened with interest to the speeches made by hon. Members on both sides of the House. I agree with the hon. Member for Stoke-on-Trent, South (Mr. Stevenson) that we must consider the money that we are being asked to give local authorities today in the context of the huge sums that our constituents, as taxpayers, contribute to local government yearly. They give local government no less than £39.9 billion—nearly one quarter of our total national expenditure.
I cannot help feeling—I may be wrong—that some Opposition Members think that the Conservative party does not care about local government or value its work. I have to tell them that I have often discussed local government matters with my hon. Friends and with ministerial colleagues and I have not detected any such feeling. I have served in local government for six years myself and I greatly value the work that local government does. It has a long and proud tradition and I pay tribute to the numerous councillors of all political persuasions who work very long hours for very little money and for the most part deliver very good services to those whom they represent.
My hon. Friends and I value the work of local government, but we are not uncritical. We think that the British people may not be getting quite such good value for money from local government as they might. I believe that there are too many councils, that they are too expensive and that, in some councils, there is a degree of incompetence which should not and cannot be tolerated and which certainly would not be tolerated in the private sector.
In England and Wales alone, there are 47 county councils, 333 non-metropolitan districts, 36 metropolitan districts and 33 London boroughs. Ours is a small island and, bearing in mind that we could add to that figure the hundreds of parish and town councils, we are perhaps the most over-governed country in the western world. As if

that were not enough, Opposition Members talk about regional government, which would cost about £375 million a year. I can think of much better things to do with £375 million than to waste it on regional assemblies.
We must draw a clear distinction between local delivery of services and local political decision-making. I am sure that all hon. Members will agree that our constituents expect their services to be delivered locally through local offices to which they can go if something goes wrong and to have elected representatives to whom they can go if they do not get satisfaction. That does not mean, however, that we need a political decision-making body every 35 miles the length and breadth of the land.
My second point is that local government is too expensive. It follows from the fact that we have too many councils that we have too many councillors. Leaving aside parish and town councillors, we have no fewer than 25,087 councillors—

Madam Deputy Speaker: Order. The hon. Gentleman is falling into the trap into which many other hon. Members on both sides of the House have fallen. He must relate his remarks more closely to the reports.

Mr. Stephen: I am grateful, Madam Deputy Speaker.
Let me, then, deal with some of the comments made by other Members on the specific matter to which the report relates. The hon. Member for Stoke-on-Trent, South said that a kind of poll tax register would have to be maintained for the purpose of administering the council tax. I do not believe that to be the case.

Mr. Stevenson: Does the hon. Gentleman agree that the hon. Member for Brentwood and Ongar (Mr. Pickles)—one of his hon. Friends—confirmed precisely that?

Mr. Stephen: My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) must speak for himself. My opinion is that a register would not be needed. The hon. Member for Stoke-on-Trent, South will recall that, under the old rating system, the rate bill was sent to the household and the people in that household would work out among themselves how it would be paid. Those who thought that the rateable value of their property should be reduced had to apply for a reduction. Those who felt that they were entitled, by virtue of their personal circumstances, to have their bill reduced also had to apply. The council tax will be no different. Bills will be sent out to households on the assumption that two people live in them. If only one person lives in a household, that person must apply for a reduction.
The valuation system to be adopted will be the same rather rough-and-ready system that was used by the Inland Revenue to place properties in a rateable value category. I am glad to hear that the private contractors who have been entrusted with the task of valuing properties are using modern technologies such as hot air balloons to perform it more effectively!
The new system will be much simpler than the old rating system, because we shall not have to place on each house a specific value down to the last pound. We shall merely have to identify it as a band-C or band-D house, or whatever. That is a rough-and-ready approach. There will be—

Madam Deputy Speaker: Order. I am afraid that it is too rough and ready. How does it relate to the introduction of the council tax and the moneys needed for it?

Mr. Stephen: I was simply responding to remarks that the hon. Member for Stoke-on-Trent, South was allowed to make, Madam Deputy Speaker.
I entirely agree with my hon. Friend the Member for Langbaurgh (Mr. Bates) about the need for information technology. The world of information technology has undergone remarkable changes in the past five years. I know that, because I am a consultant to a company in the information technology field—and I must declare my interest in that respect. It is now no longer necessary for any local or central government department to own any computers, to employ anyone to operate them or to lease or own any buildings in which to house them. Departments need only tell one of the many private-sector companies what data to put in at one end and what they expect out of it at the other. They can leave to the private sector the task—a task for which it is much better equipped than local government—of working out what computers to use, who to employ and how to do the job. I commend that way of operating to any local authority faced with the job of introducing the software and hardware that may be necessary for the administration of the council tax.
The hon. Member for Cardiff, West (Mr. Morgan) said that subsidies should be given to areas with low rateable values. I entirely agree with him that central Government subsidy is a legitimate function and that areas unable to raise sufficient money from their local people can rightly expect a subsidy from the rest of the country. My ministerial colleagues are aware of that point and give effect to it.
The hon. Member for Cardiff, West also referred to morale in local authority treasurers' offices. He would surely agree that morale depends on the quality of leadership that those people receive. If they are led by dismal Jimmies who can do nothing more than wring their hands and moan about lack of Government money, it is hardly surprising that they are demoralised. If, on the other hand, as is the case in most Conservative-led local authorities, those people are led by positive people with the attitude that they can do something, rather than that they cannot, I suspect that morale is higher.
I welcome the report and believe that the money should be given to local government and used for the specified purpose, but a great deal needs to be done before the people of this country receive the value for money from local government and the efficient delivery of local services which they are entitled to expect.

Ms. Marjorie Mowlam: The hon. Member for Shoreham (Mr. Stephen) referred to proposals for regional government. He should check whether those are the proposals of the President of the Board of Trade and be careful that he does not direct criticisms at the Opposition Benches. Some of those proposals come from the Government.
Langbaurgh, to which reference has already been made, welcomes the special grant because we desperately need it. It is sad that it has come so late and in such a small amount. Many of the problems that we face will be

compounded when the council tax is introduced. If the grant had been available when it could have been used to good effect by the local authority, we could have dealt with some of the problems of uncollectability mentioned by the hon. Member for Langbaurgh (Mr. Bates).
The special grant will arrive when we already have problems with implementation in Langbaurgh. It will add to the problems and it will take us longer to solve the difficulties. It will help, but it has not arrived at the right time or in the right amount to deal with the serious problems facing Langbaurgh.
Another problem that we will face as a result of the special grant is that it does not take account of the nature of households. There are many one-parent households in Langbaurgh. The special grant does not relate to the make-up of the constituency and will not be the right amount to deal with the extensive problems facing us.
The hon. Member for Langbaurgh referred to non-payment. I agree with him that it is unacceptable that others should pay, but he should be more straightforward and consider why that problem exists. There is a difficulty with non-payment, but we have a serious problem with collectability because of the nature of the poll tax. The Opposition have highlighted that problem on many occasions and it must be addressed. Langbaurgh had been caught by that problem.
No grant can take account of the difficulties that councillors and officers of local authorities have faced in trying to implement the poll tax in the transition to the council tax. The previous lack of funding has left morale very low. The hon. Member for Shoreham made a facile and silly point when he said that Conservative authorities are positive and dynamic and that the dismal Jimmies in Labour authorities caused the problems. That is not the case. It is clear from representatives of local authorities of both political persuasions and of representatives of hung authorities that there is a serious morale problem.
Some problems arise for political reasons with powers being removed. There is also a serious problem because both Labour and Conservative councillors have difficulties in doing their job. We must consider the issue of civic duty. That is not a party political point and the serious problem of morale must be addressed if we are to deal with the problems that local authorities will face.

Mr. Bates: I am interested in the point about uncollectability. What makes it easier for 400-odd councils to collect more community charge as a percentage of their budget than we do in Langbaurgh? What makes it more collectable in those areas?

Ms. Mowlam: If the hon. Gentleman had been in Langbaurgh a little longer with his predecessors from the Labour party or from his party, he would know that Langbaurgh council had had an on-going difficulty. Together with the hon. Gentleman's predecessor, we met Minister after Minister in cross-party delegations to consider the difficulties with standard spending assessments. The SSAs have taken money from the council year after year and the council has had to take money from Peter to pay Paul. There have been serious problems in relation to sufficient staffing across departments and having people who want to stay with a council with such serious problems.
We must consider the confidence of officers, and councillors from both parties acknowledge that we have a


problem. I have addressed that problem in cross-party discussions and I hope that the hon. Member for Langbaurgh and I can consider it with the Department of the Environment and the Department of Trade and Industry in the future.
The hon. Member for Langbaurgh knows the geography of the area as well as I. Many people work outside the area on rigs and many work in London. We have a mobile population which is sometimes considered to be an inner-city problem. Our area has the second highest unemployment level in the United Kingdom. It is second only to Northern Ireland.

Mr. Morgan: My hon. Friend is getting across the message very clearly that only a small part of the problem of collectability relates to the Tory mythology of the "Won't pay" extremist Trotskyite groups which are encouraged by Militant Labour Members. Any city treasurer would claim that the overwhelming majority of the difficulties of collection relate to the mobility of population, particularly among 18 to 25-year-olds who simply disappear or who go from one property to another every two or three months. They crash-pad out here, crash-pad out there, return home and then leave home again. No one really knows where they are. It is very difficult to discover someone's whereabouts during the three months that someone qualifies to pay the poll tax. That is why the Government have scrapped the poll tax five years after they introduced it.

Ms. Mowlam: I concur with my hon. Friend. We are not overwhelmed by Trots in Langbaurgh, as I am sure Conservative Members are aware. However, some people do not pay and I met one in my surgery on Saturday. That 82-year-old lady could not pay her poll tax or her electricity bill. She put the bills in front of me and asked me what she was meant to do. Some people are not paying because they do not want to; people on the Government's basic state pension cannot pay.
When he referred to the difficulties, the hon. Member for Langbaurgh said that the Labour party was interested only in the culture of grabbing money. He said that we always want more and that we are not interested in efficient expenditure. I can assure him that hon. Members on both sides of the House are very interested in efficient expenditure and a decent customer service. However, we need to know where the money is coming from and when so that we are not paying 1991 bills as a result of a late Government handout and afterthought in respect of computerisation. If we had known about the grant, we could have planned an efficient service. We cannot do that because of the short notice.
Because of the lottery of funding, whether that be through the assisted status scheme, city challenge, or a development corporation, we must fish from pond to pond to try to run an efficient local government service.
I am with the hon. Gentleman all the way. Yes, let us have efficient services, but let us have a culture that delivers public money to local authorities so that they can function efficiently. Local councillors at whatever level and of whatever party are finding it impossible to do an efficient job because of the incompetence of central Government.

Mr. Paul Murphy: It is always a pleasure to follow my hon. Friend the Member for Redcar (Ms. Mowlam). Opposition Members take to heart her comments about the culture of local government.
Before I comment on the debate proper, I make a technical point to the Under-Secretary of State for Wales about precisely which document we are dealing with. Some days ago, we obtained from the Vote Office the Local Government Finance (Wales) Special Grant Report No. 40 under section 88 of the Local Government Finance Act 1988. Earlier this afternoon, my hon. Friend the Member for Jarrow (Mr. Dixon), the Opposition Deputy Chief Whip, indicated that we are dealing with the Local Government Finance Special Grant Report (Wales) 1992, under section 146 of the Local Government and Housing Act 1989. The confusion over which document we are to use, coupled with other matters that have been mentioned in the debate, including the revelation that hot air balloons will be used to value the people of Wales, or at least their houses, do not inspire much confidence in how the Government will deal with the implementation of the council tax.
Although we are dealing with grants of £6 million paid to Welsh district councils to administer the new council tax, hon. Members talked about the adequacy of that settlement and the detailed nature of the implementation of the new council tax. In Wales, the figure is £6 million, so we are told—that figure is in both books, so I assume that it must be right—although local government treasurers in Welsh district councils still believe that that is not adequate to cover the various aspects of the implementation of the council tax. The hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) said that his two district council treasurers are not happy with the settlement that they have received, and nor is the treasurer of my local authority. When we look at the various factors that make up expenditure for the implementation of the tax we can see why they are unhappy. It is not simply a matter of having the staff to administer in their offices. My hon. Friend the Member for Stoke-on-Trent, South (Mr. Stevenson) and the hon. Member for Croydon, North-East (Mr. Congdon) both talked, although from different sides of the argument, about the need for a register. Whatever the Government say, a large number of billing authorities in Wales will have to establish some form of register to enable the council tax to work properly, and that will cost a great deal of money.
Reference has also been made to computers. If local authorities in Wales had not had the foresight to invest in computer hardware and software, they would be in serious difficulties in implementing yet another new local government finance system.
My hon. Friends the Members for Knowsley, North (Mr. Howarth) and for Cardiff, West (Mr. Morgan) referred to discounts, banding and benefits. All those aspects of the new local government finance system which we are to introduce in a year will cost a great deal of money. The Government—in this case, the Welsh Office —have calculated precisely how much they will give each local authority on a rule-of-thumb basis. That is not good enough. That system is based on the number of properties in a local authority area, not on the number of payers.
The hon. Member for Shoreham (Mr. Stephen) referred to the dismal Jimmies in the finance departments of our


local councils. That is a slur on what they do. Staff in local government finance departments must, within two or three years, deal with an enormous number of unnecessary changes in local government financial systems. Next year, they will have to deal with the demise of the poll tax. They will have to wrap up that tax; introduce a brand new tax, the council tax; deal with the growing problem of arrears; and deal with the transitional relief of the non-domestic business rate. Combine all those things together and we see that the amount of work that has to be undertaken by our local council treasury departments is beyond the expectations of what they should normally do.
The whole package is ultimately unnecessary. The hon. and learned Member for Montgomery (Mr. Carlile) rightly said that most people in Wales will regard a penny spent on changing the administration of local government finance to be entirely the responsibility of the Government, because they caused the changes to come about and therefore should pay for their implementation.
If ever there has been an intolerable waste of public funds, it is what has been wasted on local government finance in just a few years. In Wales alone, £100 million has been squandered on the implementation and the sweetening of the poll tax. We must add to that the fact that most of our local councils will have to cut their expenditure in the coming year—although they have not yet been given the revenue support grant, which in itself is a scandal—and they will have to cut services, while the House of Commons will legislate to increase expenditure on administration.
The Conservative party has always said that it is the party of good management. If any local authority had mismanaged its finance in the way in which the Government have mismanaged theirs, they would have been in dire trouble indeed. The hon. Member for Erewash (Mrs. Knight) had the cheek to talk about wasteful Labour local councils when every penny of the £6 million of Government money in Wales alone was ultimately unnecessary. The Welsh council tax will not end that. My hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) and, although in a different context, the hon. Member for Brentwood and Ongar (Mr. Pickles) mentioned gearing. The amount that Welsh local authorities can now raise by way of revenue is extremely small. The effect of that on what is left of local democracy in Wales is indeed very bad.

Mr. Ray Powell: I regret that I was not present for the start of my hon. Friend's speech, as I was attending to House business. I am concerned about finance, particularly when it affects Ogwr borough council. The Under-Secretary of State for the Environment has mentioned the 4,609 council houses that were sold by Ogwr borough council between 1981 and 1991. I do not know whether my hon. Friend has referred to the amount that has been raised by such sales, what will happen to it, or whether it can be used to build houses for my constituents in Ogwr borough who are crying out for accommodation, yet the Government are failing to respond to their demands.

Mr. Murphy: I agree with my hon. Friend the Member for Ogmore (Mr. Powell) that that money should be recycled into the local community to make new houses

available for our people. However, that is another matter —but at least it would be using public money for good ends.
My point was that, necessary as the report might be, the money has simply been put into the administration of our Welsh local authorities. It has not gone to produce services for our people. One of the most tragic consequences is the instability and even chaos which have entered our local government system.
We have seen enormous changes during the past five years. We have seen value added tax increased to pay for the appalling chaos of the poll tax. The cost of implementing the council tax will lead to a tremendous lack of confidence among people in local government and in Wales as a whole in any regime of council finance that the House approves either today or in the weeks and months ahead.

Mr. Morgan: Before my hon. Friend finishes his speech, will he refer to the applicability in Wales of the suggestion made by the hon. Member for Shoreham (Mr. Stephen) that major savings could be made by local authorities when they implement the new calculation procedure by following some new Tory slogan of, "Do your banding while you're ballooning" or, "Do your ballooning while you're banding"? Will he comment on the idea that if the hon. Member for Brentwood and Ongar (Mr. Pickles) was still the leader of Bradford city council he would probably hire Virgin Atlantic to do the ballooning because then it could be called the Branson Pickle?

Mr. Murphy: I am not sure how I can incorporate that idea into my final remarks, hut, nevertheless, I found it enjoyable.
There is a special case for Wales. I address that case to the person who will speak last in the debate—the Under-Secretary of State for Wales. The changes in local government finance and the £6 million that we are approving this evening to implement the council tax have to be set alongside the changes in local government that the Welsh Office and the Government say will come about in Wales. Will the Minister assure us, and, indeed, Welsh local government, that they will implement their so-called reform of the structure of local government at the same time as they implement the council tax next year?
Will the county councils have to hold elections next year? Will they have to budget and plan? If the county councils have to set their budgets and the district councils have to collect the money for the county councils, all local government in Wales will effectively be in financial limbo. It will be frozen in the financial sense. Unless we know with some certainty what will happen to Welsh local government, all that we have dealt with this evening with regard to local government finance in Wales will be meaningless. I hope that the Minister will tell us, within the confines of the motion of course, whether implementation of the council tax will proceed alongside the reform of local government in Wales.
Of course, we shall not oppose the reports. By so doing, we would plunge many local authorities into penury. But we accept them with a certain reluctance based on the uncertainty and instability in the local government systems in both England and Wales. I hope that the Minister will give us a clear idea of how that instability can be overcome, at least in the Principality.

The Parliamentary Under-Secretary of State for Wales (Mr. Gwilym Jones): We have had a good and useful debate, especially because we have heard speeches from hon. Members on both sides of the House who have had experience of local government. As one who served on Cardiff city council for 13 years, I especially valued their speeches.
I must first respond to the query of the hon. Member for Torfaen (Mr. Murphy) about the reports. Due to a drafting error, the reports were originally laid under the wrong power. We immediately withdrew them and have relaid them under the correct provisions. The amounts of grant set out in the reports did not change.
The hon. Member for Sheffield, Brightside (Mr. Blunkett) fascinated me when he said that he had seen a bright spot on 10 April when he realised that he would not be practically involved in local government finance. It must have come as a blessed relief to him, and I suspect to every other member of the Labour party, that he would not be plunged into government with all the dreadful promises that the Labour party had made.
The hon. Member for Brightside went on to quote The Times. He suggested that councils were already engaged in a campaign against the threat to their survival. In the Principality there is the broadest agreement about the progress that my right hon. Friend the Secretary of State for Wales is making on the reform of local government. There is the broadest agreement that we should move to unitary authorities. That will be accomplished by 1995. I suggest that England might want to take a leaf out of Wales' book about how to make progress in that direction.
The hon. Gentleman pursued the need for a register. My hon. Friends—especially my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles)—effectively disposed of that. I suspect that the need for a register is being pursued only out of a socialist yearning to keep everything on a register. The community charge register will be used only to provide an estimate of each authority's revenue-raising power in the first year of the new council tax. It is clearly the best information available for that purpose. From the second year of the tax, the previous year's figures will be used as the basis of rate support grant. Thus, I emphasise that there will be no need for a register beyond the transitional phase.
The hon. Gentleman estimated that authorities would need much more cash. He should note that the reports before the House relate only to 1991–92 and 1992–93. Costs in 1993–94 will be taken into account in the RSG settlement for that year. I suspect that the figure that he quoted was for all three years. He complained that banding would be inaccurate. It is surely self-evident that a system which relies only on broad value bands will be less subject to error than a system based on precise valuations. As the hon. Gentleman advocates the latter type of system, he should be careful not to criticise the accuracy of our system.
The hon. Gentleman suggested that the regulations were late. We have already provided all the key regulations that the authorities need. Some regulations remain to be made. The absence of less critical regulations is not inhibiting local authorities' progress. The most important regulations which remain to be made are on transitional relief. The key figures in those regulations are linked to the RSG settlement. Obviously they cannot be made until the

RSG settlement details are available. But we have already told local authorities the structure of the transitional scheme and we shall shortly issue our draft regulations. Local authorities will therefore have perfectly adequate information on which to base their computer systems.

Mr. Blunkett: Perhaps the Minister will tell us why the provisional grant settlement has been deferred from its usual slot at this time of the year to the autumn, thus causing the local authorities considerable problems in planning their financial strategy for 1993–94.

Mr. Jones: If the hon. Gentleman will be patient, I shall come to that in a moment. I am responding to the points that he made. He also referred to charge capping. As I have already said, council tax and transitional arrangements will be taken into account in the settlement for the forthcoming financial year.
It is essential that the Government retain a strong capping power to ensure that the introduction of the council tax is not used as an excuse for irresponsible and unnecessary expenditure. On the question about transitional reductions, the Government are committed to limiting the increase in bills which households will face as a result of changing to the council tax. The transitional scheme may vary with property bands. Details of the scheme cannot be decided until property valuation is completed.
The hon. and learned Member for Montgomery (Mr. Carlile) asked about interest on capital costs covered by supplementary credit approvals. They will be met through RSG. I was intrigued that the hon. and learned Gentleman congratulated the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), who is not with us in the Chamber, on his local success and perseverance. I wonder whether the hon. and learned Gentleman would make the same comments about the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis). The hon. and learned Member for Montgomery objected to paying himself in Montgomeryshire. I have to ask him, as did my hon. Friend the Member for Croydon, North-East (Mr. Congdon), where he thinks that the money comes from. What dangerous naivety does he live in? As my hon. Friend said, the Government do not have any money of their own. It comes from taxpayers in Montgomeryshire and elsewhere. We all have to pay. The special grant arrangements and revenue support grant are the appropriate way forward.

Mr. Morgan: rose—

Mr. Jones: Excuse me, but I must make progress.
The hon. and learned Member for Montgomery asked me to reject the notion that all community charge has to be paid. He seeks to rival the Labour party in being more extreme and more left-wing in that respect. The Government have repeated time after time that there can be no amnesty. I fully support—

Mr. Alex Carlile: Will the hon. Gentleman give way?

Mr. Jones: Forgive me, but I must make progress.
I fully support the view of my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) that it is irresponsible to let some people off when the majority have paid and would have to pay for those who do not.

Mr. Carlile: Will the hon. Gentleman give way?

Mr. Jones: No—[Interruption.]

Mr. Deputy Speaker (Mr. Michael Morris): Order. The Minister is not giving way.

Mr. Carlile: He should.

Mr. Jones: The hon. and learned Gentleman knows that time is running out, and I wish to respond to everyone who has contributed.
My hon. Friend the Member for Erewash (Mrs. Knight) made an excellent contribution and gave us her experience of five years on Sheffield city council. It is little wonder that the hon. Member for Brightside wanted to dismiss his time there as the distant past. She was able to explain that, under the leadership of the hon. Gentleman and his hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts), Sheffield was in a shambles. I appreciated her argument that Derbyshire cricket club brings more credit to the county than Derbyshire county council. That would not be difficult.
The hon. Member for Knowsley, North (Mr. Howarth) was concerned that disabled people might be overlooked. I hope that they will not be. We are aiming to provide reductions for people who are substantially and permanently disabled, which will ensure that no disabled person pays a higher bill because they need more space as a result of their disability.
The hon. Member for Stoke-on-Trent, South (Mr. Stevenson) asked whether supplementary credit approvals were possible. They will be available up to a total of £41.2 million in England and will be provided against expenditure on preparation. Each authority will have a maximum allocation, based on the number of properties. As the Minister said at the outset, if any SCAs are not applied for they will be recycled to other authorities that may need them. The hon. Gentleman also alleged discrimination against Stoke-on-Trent. There is no discrimination against his authority. It receives less grant than other authorities because it has fewer dwellings. A common amount for each authority would be nonsense. Why should a small shire district get as much as Birmingham or Manchester?
My hon. Friend the Member for Langbaurgh (Mr. Bates) robustly advocated our progress in shouldering the burden of paying for local government finance. How right he was. The consequences of the "Don't pay" campaign advocated by Opposition parties was merely to shove the burden on to someone else. I was delighted to hear my hon. Friend say that Conservative successes in two local elections in his constituency were the logical outcome of that campaign.
The hon. Member for Cardiff, West (Mr. M organ)— my neighbour and an old school friend—mentioned the need for a higher level of grant support in Wales. I appreciate his point. The level of support in Wales is appropriate, and it will continue to be. We have taken that into account in setting different, lower property bands for the council tax in Wales.
My hon. Friend the Member for Shoreham (Mr. Stephen) related his six-year experience of local government. I agree with his tribute to many people in local government who give so much of their time to serve their electorates.
The hon. Member for Redcar (Ms. Mowlam) apologised for the fact that she could not be here for the winding-up speeches. I was glad of her welcome for the

grant reports. I appreciate her desire to make the best case for her part of the world. That is the natural and imperative duty of all hon. Members, and I applaud her spirit in seeking to work with my hon. Friend the Member for Langbaurgh.
The hon. Member for Torfaen claimed, unsurprisingly, that some councils in Wales feel that the special grants that we have prepared are not enough. Generally, the special grants have been welcomed by Welsh local councils. Three Welsh local councils were used in the survey by CSL which helped us to introduce the grants—Delyn, Newport and Monmouth.
In his opening speech, my hon. Friend the Under-Secretary told the House about the considerable degree of work that is under way to ensure that preparations for the council tax proceed smoothly to its introduction on 1 April next. There is close collaboration between central Government, local government and key organisations such as the Valuation Office agency. I have been very heartened by the input made by all concerned and, speaking from my own experience in Wales, by the constructive and professional approach that local authorities are taking to preparing for the new tax.
The valuation banding exercise is nearly complete, and considerable progress has been made on other important aspects of implementation, including, on the Government's part, secondary legislation and practice notes. In Wales, provision has been made for the electronic transfer of valuation lists in a variety of formats that best suit the needs of each authority. Most Welsh councils will have lists sorted in community order. At all stages in the preparatory process we have taken care to consult local government and other interested parties and to consider their views carefully.

Mr. Morgan: Will the hon. Gentleman give way?

Mr. Jones: I know that the hon. Member for Cardiff, West has so much hot air to contribute—but not in the time left to me.
Final decisions on any transitional arrangements under the council tax cannot be arrived at until details of local tax bases are complete and have been analysed. We have not yet made a decision on whether transitional arrangements will be put in place for Wales. We will consider the need for transitional relief if significant numbers of households face large increases as a result of the new tax. If my right hon. Friend the Secretary of State for Wales considers, in all the circumstances, that a scheme of transitional relief is appropriate, he will consult the local authority associations on the arrangements and how to fund them. Draft regulations setting out a framework for the scheme—if there is to be one—have been issued.
The level of council tax and transitional arrangements will also have implications for total standard spending and aggregate external finance under the local government revenue settlement for 1993–94. The Government wish to take those implications into account and for that reason —this brings me to the point mentioned by the hon. Member for Brightside—they announced last month their decision to postpone the provisional settlement for 1993–94 until the autumn. I am sure that the House will agree that it is essential that we take into account the most up-to-date information in determining the settlement.
The Government's decision to make special grants available in respect of council tax preparation costs has


been welcomed by local authorities. The grant allocations set out in the two reports before the House will he of considerable help to local authorities in their preparations.

Mr. Morgan: Will the hon. Member give way?

Mr. Jones: I know that the hon. Gentleman has the old school tie connection. I suppose that I cannot resist that.

Mr. Morgan: Will the hon. Gentleman take up the suggestion made by the hon. Member for Shoreham (Mr. Stephen) about employing hot air balloons to conduct the valuation and handing exercise? If so, can he tell us how he will use some of the expense that that might save? He has spent a lot of Welsh Office money on changing the notepaper since he introduced his new title. He does not want to be called Parliamentary Under-Secretary of State; he wants to be called Parliamentary Secretary.

Mr. Deputy Speaker: Order. That is outside the province of the motion. The hon. Gentleman has been here long enough—

Mr. Morgan: rose

Mr. Deputy Speaker: Order. I do not expect to have a discourse with the hon. Gentleman.

Mr. Jones: I am sorry that I gave way to the hon. Gentleman. It was a silly intervention and turned out to be nothing more than something out of his hot air department again.
For those authorities whose expenditure exceeds their grant allocation, by far the greater part of the excess will be met from central Government support within aggregate external finance under the local government revenue settlements for Wales and England.
The grant allocations and arrangements set out in the special grant reports for England and Wales are generous and fair. They clearly demonstrate the Government's commitment to facilitating the smooth and timely implementation of the council tax on 1 April 1993 which, contrary to the recent gloomy prognostications made by the hon. Member for Brightside, is firmly on course.
I apologise to any hon. Member if I have not replied to their questions in the short time available, and in the time spent dealing with interventions, some of which I should not have wasted my time on. I will endeavour to write to all the hon. Members to whom I have not replied. I commend the reports to the House.

Question put and agreed to.

Resolved,
That the Special Grant Report (No. 4) (House of Commons Paper No. 61), which was laid before this House on 17th June, be approved.

LOCAL GOVERNMENT FINANCE (WALES)

Resolved,
That the Special Grant Report (Wales) 1992 (House of Commons Paper No. 80), which was laid before this House on 19th June, be approved.—[Mr. David Hunt.]

Community Charges

The Minister for Local Government and Inner Cities (Mr. John Redwood): I beg to move,
That the draft Charge Limitation (England) (Maximum Amounts) Order 1992, which was laid before this House on 22nd June, be approved.
The range of local authority responsibilities is enormous—from education and planning to refuse collection; from social services to street lighting. The range will soon be extended to cover care in the community. Local authorities enable local people to have influence over the quality, efficiency and range of local services. That is the stuff of local debate and the substance of local elections. The local delivery of certain services—many of them essential to their communities—is a central feature of a pluralist society.
Because of the range and scale of their responsibilities, local authorities spend very large sums of money. In each county and district area, local authorities spend well over £1,000 for every man, woman and child each year. For example, last year, the total spending per adult was £1,840 —a very large sum of money. Total local government expenditure is now running at around £65 billion. That means that local authorities have a great deal of choice and discretion over how many and what kind of non-statutory services to supply, and discretion over the style, quantity and quality of many statutory services. Of course, everyone in the House believes in local government and wishes it to flourish.
It gives me no pleasure, therefore, to move the motion. I should prefer there to be no need to cap at all. But, unlike Labour Members, we are prepared to face up to the problems that excessive public expenditure can pose. Most now agree that there should be overall limits on both public expenditure and taxation. Some Labour Members are looking a little quizzical, but the Labour party proposed caps for its regional assemblies in its general election programme. The right hon. and learned Member for Monklands, East (Mr. Smith) is always trying to exert some control over the spending proclivities of his hon. Friends, although we know that he is often unsuccessful. As local authority spending is now nearly 9 per cent. of gross domestic product and about a quarter of total public expenditure, that, too, has to be under some control to ensure that total public expenditure is under control.
For the 1991–92 budget cycle, we acted by announcing provisional capping criteria in the preceding autumn as authorities had suggested. When authorities came to set their budgets, they knew our intentions for capping. The result speaks for itself. Local authority budgeted spending was about only 0.5 per cent. more than the amount that we provided in our settlement for that year.
The Local Government Finance and Valuation Act 1991 allowed us, in the 1992–93 budget cycle, to consider authorities budgeting below £15 million for the first time. We again announced provisional capping criteria in advance of authorities setting their budgets.
What has happened this year? More than 400 authorities have budgeted within or very close to the limits implied by the provisional criteria. Overall, the total of local authority budgets is about 1 per cent. more than the amount for which we made provision in our settlement for 1992–93. That result is an achievement of our capping


strategy. I should also like to see it as a tribute to the good sense and responsibility of much of local government. All that is a far cry from the alarmist comments of the hon. Member for Dagenham (Mr. Gould) on Second Reading of the Local Government Finance and Valuation Bill, when his remarks went over the top.
This year's capping round began last November when the former Secretary of State for the Environment, my right hon. Friend the Member for Henley (Mr. Heseltine), announced the provisional criteria for designating authorities for capping which he intended to adopt. Local authorities were told, at that time, that they should not assume that small amounts of spending above the criteria would be allowed. My right hon. Friend said that he intended to consider the effect of boundary changes on authorities' budgets for 1991–92 and 1992–93.
My right hon. Friend stated, when he laid before the House the 1992–93 settlement reports on 23 January 1992, that he stood firmly by his intentions for the capping criteria which he had announced on 26 November. On 12 March, the former Minister for Local Government and Inner Cities, my right hon. Friend the Member for Enfield, Southgate (Mr. Portillo), confirmed to the House, in a written answer, the intention to use the same provisional criteria.
Local authorities knew in advance of setting their 1992–93 budgets what to expect. Our aim this year was to act to achieve as much as possible in advance by laying down clear and fair guidelines, with as little as possible having to be done by actual capping.
On 14 May, my right hon. and learned Friend the Secretary of State for the Environment took his capping decisions. He had regard to all appropriate considerations, including the budgets which authorities had set, the effect of boundary changes on authorities' budgets for 1991–92 and 1992–93, and those provisional criteria.
My right hon. and learned Friend made only one modification to the original criteria by including a de minimis proviso—where the reduction from capping would be less than £1.50 per adult, he agreed not to cap. In deciding that, he had regard to a number of considerations applicable to this year. As he told the House, it should not be assumed that in any future year we would include a similar de minimis proviso.
On the basis of those clear principles, 10 authorities were designated for capping. Of the 39 county councils, 37 budgeted below the criteria. All of the 36 metropolitan districts budgeted below the criteria. Of the 33 London boroughs, 30 budgeted below the criteria. Of the 296 non-metropolitan districts, 291 budgeted below the criteria.
I remind the House that no authority is capped if it budgeted at or below its standard spending assessment. To those Labour Members who dismiss SSAs as inadequate, I emphassise that, in total, they increased by almost 7 per cent. this year—well above the expected rate of inflation —which built on a substantial 19.4 per cent. rise in 1991–92. We have listened to local authority representations on those issues and we have acted.

Hon. Members: No, the Government have not.

Mr. John Wilkinson (Ruislip-Northwood): That is not the case if my hon. Friend considers the London borough

of Hillingdon, which has done everything in its power to act responsibly in its financial management. Because of the concerns expressed by the three hon. Members who represent seats within the borough of Hillingdon—my hon. Friends the Members for Hayes and Harlington (Mr. Dicks) and for Uxbridge (Mr. Shersby) and myself—my hon. Friend should be aware of the special circumstances in the borough, namely, the large influx of refugee children who must be accommodated because Heathrow happens to be in the borough. Hillingdon is also affected adversely by the financial formula—because many of its schools—three quarters of them in Ruislip-Northwood—have opted out. Therefore, the Minister should be much more generous in our case.

Mr. Redwood: I am well aware of the worries of my hon. Friends who represent constituencies in Hillingdon. They have been assiduous in putting their case to the Government. In February, there was a meeting with the Prime Minister, and the Government again considered their representations. Unfortunately for my hon. Friends, we concluded that the SSAs were fair and that, therefore, the capping had to apply in the way that I have reaffirmed tonight. I assure my hon. Friends that the representations were considered carefully. No one could have done more than my three hon. Friends in putting the case for Hillingdon very forcibly to the Government.

Mr. Peter Bottomley: Although I accept the decision that the Government have made on the SSAs, of which many will not approve, it would be welcome to both sides of the House if the Government told the Department of the Environment and other Departments—in the case of Greenwich, the Department of Health which is responsible for social service SSAs—that they should be willing to receive deputations and examine the way in which factors work. As other hon. Members will no doubt point out, the fact that Greenwich looks after children at the cost of £39 a year, when the neighbouring borough of Lewisham, with virtually identical characteristics, spends £139, shows that the factor system operates beyond all reason.

Mr. Redwood: Of course I shall look again at any representations for next year's SSAs that my hon. Friends or Opposition Members wish to make. The Department always looks carefully at the data for each year—the base data on which needs are assessed are often revised annually—and at the methodology, when people present new arguments or fresh evidence that needs to be considered.

Sir Dudley Smith: Although this is not the time to debate SSAs in detail because the figures are before us, will my hon. Friend undertake to continue the dialogue on SSAs with my hon. Friends and I from the Warwickshire area? We genuinely believe that the SSAs for our county are flawed.

Mr. Redwood: I assure my hon. Friends who represent Warwickshire that I shall look carefully at any points, on the data base or on how the SSAs are calculated, made by any hon. Member who feels that those need investigating. Some councils feel strongly about those matters. My right hon. and learned Friend and I need to be persuaded that there is something wrong with the theory and application of SSAs. They apply to many councils and must be fair across the country.

Mr. James Pawsey: First, I thank my hon. Friend for giving way. This is the fourth time that he has given way in his speech and I appreciate the impact that that has on his speech.
Although my hon. Friend makes an eloquent and persuasive case, he must admit that there is considerable power in the argument advanced by hon. Members representing Warwickshire. He may agree that Warwickshire has been hard done by. Although I acknowledge the additional £4 million granted to my county on appeal, the strength of Warwickshire's case is outlined, first, in the booklet that my hon. Friend has received and, secondly, in the booklet on the standard spending assessment. I hope that my hon. Friend, our right hon. Friend the Secretary of State and officials at the Department will carefully consider how the SSAs—

Mr. Deputy Speaker (Mr. Michael Morris): Order. Interventions are getting longer and longer. [Interruption.] They may be of good quality, but they are too long.

Mr. Redwood: I am gratful to you, Mr. Deputy Speaker, and to my hon. Friend. I repeat my reassurance that if there is a problem with the base data for next year or for the method of calculation for next year, we shall consider it. I am sure that my hon. Friends will not be shy in coming forward with suggestions and proposals.

Mr. George Stevenson: The Minister will appreciate that my intervention is as crucial as those of Conservative Members. Something is clearly wrong with the SSAs when Stoke-on-Trent receives £657 per head, and Wandsworth and Westminster receive £1,500 or £1,600 per head. Is there a time limit on the Minister's willingness to receive representations from local authorities that believe that their SSAs are inadequate or unfair?

Mr. Redwood: Written submissions on that subject should be sent to the Department as soon as possible, because we need to make decisions for next year in good time. Particularly with the introduction of the council tax, local authorities need to know in good time what the position will be. So the window is not long but I am willing to look at new evidence. The best way to proceed is for the hon. Gentleman to send in a written submission. We can then see whether a meeting would be a good idea or whether the submission covers a new point.
Standard spending assessments have risen by about 7 per cent. this year and they rose by 19.4 per cent. the preceding year, which represents a substantial rise in permitted spending and in the grant based on that calculation. Each SSA is based on a complex formula designed to measure the needs and requirements in different local areas by a common standard. The hon. Member for Stoke-on-Trent, South (Mr. Stevenson) referred to one or two inner London areas with relatively high SSAs, but he could have mentioned others under Labour control that have even higher SSAs. Those are based on formulae according to the number of people in different categories and the type of needs in the area. He is at liberty to obtain from the Department the basis of the calculations and satisfy himself that many other inner London areas get higher SSAs than the two that he mentioned.

Mr. Nick Raynsford: The Minister says that the SSA formula is complex. Does he agree that mistakes could be made? He will recall his meeting last week with a delegation from the London borough of Greenwich, when we discussed the particular needs of refugees and he stressed that those would be reflected in the SSAs. Having taken advice on that, it is clear to me that the SSA formula does not adequately reflect the position of recently arrived refugees. There is a substantial time lag. The need is not unique to Greenwich; other London boroughs have a similar problem. Does the Minister accept that Greenwich is being penalised by a lack of provision for those needs?

Mr. Redwood: As I have said, the Government are satisfied that the SSAs for the current year on which capping is based are fair and correct. We review from time to time the data and formulae for ensuing years. The hon. Gentleman can see that in the past adjustments have been made to reflect changing circumstances. I remind him that the Greenwich SSA is 8 per cent. more than in 1991–92, so it is above the national average increase, and 32 per cent. more than in 1990–91. So the news is not nearly as bad as he suggests.
For each of the 10 designated authorities, my right hon. and learned Friend proposed caps or maximum amounts for their budgets. He took account of all appropriate considerations in taking those decisions and the proposed caps took account of all the relevant information available to us. As in previous years, we took the view that where, on the basis of the information then available to us, we judged that authorities were able to reduce their budgets by the full amount implied by the criteria, they should be required to do so, particularly as nearly all other local authorities had lived within the criteria—some with considerable ease.
The designated authorities were notified on 14 May of their designation, the general principles on the basis of which they were designated and the amount of our proposed cap. They then had a period of 28 days in which to inform us whether they accepted the proposed cap. If they challenged the cap, they had to suggest an alternative figure together with a supporting case.
In the event, two authorities—Langbaurgh and Middlesbrough—accepted the proposed caps. Langbaurgh's proposed cap represented a small relaxation compared with the amount implied by the principles. The other eight authorities challenged. Basildon and Greenwich proposed caps of £2.96 million and £1.62 million respectively below their original budgets. The others wished to maintain their original budgets.
My hon. Friend the Under-Secretary of State and I have met delegations from each of these authorities to hear their oral representations in support of their written cases for a reduced cap. My right hon. and learned Friend the Secretary of State very carefully considered the points made at those meetings, together with all the other available relevant information before taking his decisions.
In the case of five authorities—Cheltenham, Gloucester, Greenwich, Hillingdon and Lambeth—he decided that caps should be set at the level originally proposed. For the remaining three—Basildon, Gloucestershire and Warwickshire—he has decided that, in the light of their particular circumstances, some relaxation was justified.—[HON. MEMBERS: "Hear, hear".] I am glad that my hon. Friends think that that was a wise


judgment. As a result, we have decided to increase the caps for those authorities by £1.95 million, £2.59 million and £4 million respectively.
I must emphasise that our aim during the capping process has been to require a designated authority to reduce its budget to such a level that it would no longer be excessive or represent an excessive increase. Where we judge that an authority can achieve that maximum reduction without the risk of inappropriate reductions in front-line services, we have required that of them, however tough and demanding it might be.
It is only in those cases where the circumstances of an authority are such that we judge that it would not be right within the financial year to demand the full reductions of that authority that we have decided to require a smaller reduction.
I must make it clear that, in those three cases where we have allowed an increase in the cap from the level that we originally proposed, we did so after extremely searching analysis of each of the authority's individual circumstances. My right hon. and learned Friend considers the caps of each of the eight authorities to be reasonable, achievable and appropriate, in the light of all of the individual circumstances of the authorities involved. If the House approves the draft order, it will be for each authority to decide how to live within those caps.
I have little doubt that we shall hear much from Opposition Members about the effects of capping. I can only say that time and again there are dire warnings issued about the consequences of capping which, in the event, are simply not borne out. It is for authorities to order their priorities within their caps and we are satisfied that they will be able to provide an appropriate level of service within the caps if they choose to do so.
More than 97 per cent. of local authorities have budgeted sensibly this year. Just 10 authorities, four fewer than for last year, have been designated for capping. That is the second lowest number of authorities capped in the history of rate and charge capping, despite a great increase in the number of authorities within the scope of capping following the abolition of the £15 million threshold by the Local Government Finance and Valuation Act 1991. That is an achievement in which local government as a whole can take some pleasure. It is certainly a pleasure to me.
I regret that it has proved necessary to designate even 10 authorities. Next year, with the advent of the council tax, I hope that it will not be necessary to designate any. But let there be no doubt about our resolve to ensure that the transition to the council tax is not accompanied by any great surge in spending; we are determined that the substantial Exchequer support that we now provide for local government is used to keep local taxes at affordable levels and is not frittered away on unnecessary additional spending. Local government, for its good future, needs an independent tax, which has to be brought in at sensible levels. Our aim for next year, as for this year, is that local authorities budget in line with what the country and their local taxpayers can afford.
The order, if approved, is the final step to bring the 1992–93 capping process to a conclusion. It reinforces our strategy of expenditure control and about 1.4 million charge payers stand to benefit. I commend it to the House.

Mr. Deputy Speaker: I remind hon. Members that the amendment has not been selected and that Madam Speaker asked for brief speeches.

Mr. David Blunkett: The first speech that I made from the Front Bench as shadow spokesman for local government four years ago was on capping. Given the exigencies of time, this may be my last speech in that role, so it is fitting that it should also be on capping.
It is suitable to quote back to the devil the devil's own propaganda, which the Minister may care to comment on. The propaganda contains phrases such as:
Tax capping is a democratic obscenity.
Those words were uttered not by me, but by the editor of The Timesthis morning. He stated:
Since discretionary local spending is not included in the Treasury's planning total for public expenditure, this accretion of power is pure meddling, the restless fidgeting of Treasury and environment ministers and officials. Mr. Howard and Mr. Redwood, immured in the corridors of Whitehall, have the same contempt for tiers of government below their own as do Mr. Delors and his colleagues in Brussels.
Knowing the warm feeling that the Minister of State has towards Mr. Delors and the Brussels bureaucracy, I am sure that those sentiments will give him pause for thought.
Here we are again with a Government preaching choice and denying it to the local electorate, espousing responsibility and declaring the electorate and the elected irresponsible, preaching opportunity and demanding cuts in the education, social services and leisure facilities that offer that opportunity.

Mr. Redwood: I resent the implication that I do not believe in or respect local government. I believe in it and think that it has an important role to play, as I made clear in my opening speech. Is the hon. Gentleman saying that, if it were in office, the Labour party would take no interest in the total level of local authority expenditure and would not control the amount of grant paid by central Government? Is he saying that the Labour party would give local authorities any money that they asked for, which is what the hon. Gentleman seems to be suggesting?

Mr. Blunkett: The Minister's righteous indignation will have to be aimed at the editor of The Times, not me. No doubt he will take up the matter in other quarters.
We have always made it clear that money raised and spent locally is not the business of the national Exchequer but that of local people. That principle is accepted across the democratic world, including the United States of America, and is one to which we in this country should adhere.

Mr. David Wilshire: Does the hon. Gentleman agree that all expenditure, whether public or private, has an effect on a national economy? If he does, will he explain how any central Government could wash their hands of one part of expenditure?

Mr. Blunkett: The expenditure that the Government have to raise by borrowing is something that the Government have to take into account. We disagree with the Government on what should be counted as part of the public spending totals raised through borrowing. We believe that the practices of other countries in the Organisation for Economic Co-operation and


Development are more sensible, as they allow subsidiarity so that money can be raised from the markets at democratic levels below that of the national Government. That makes the economies of those countries much more effective and less likely to come under the pressures of the Maastricht treaty arrangements. I am sure that hon. Members from all parties would be interested to examine those policies.
There is no evidence that locally raised and spent revenue has a major impact on inflation or the Government's ability to raise from the markets the money that they need. Hence the Government's own belief that when they increased value added tax the effect on the economy was marginal. However, they seem to believe that £3 on the poll tax of the people of Gloucester will have a dramatic impact on our economy in future and the Government's ability to manage their economic policy—in so far as it exists.

Mr. Wilkinson: I appreciate the hon. Gentleman's generosity in allowing me to intervene yet again -in the debate.
The cap will reduce the community charge in Hillingdon borough by the princely sum of £5 per head. To my knowledge. I have not yet had a single letter from a constituent complaining at the level of community charge this year.

Mr. Blunkett: I can only accord with what the hon. Gentleman says—the staggering £5 reduction has obviously evoked an enormous and grateful reaction from the Hillingdon electorate and will clearly make an enormous difference to the bridging problems of the current account deficit with which the Chancellor is struggling!

Mr. Terry Dicks: I wish to take up the remarks of my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson), as I have received complaints about the additional charge to poll tax payers that was necessary in order to look after refugee children. If that responsibility had been accepted by central Government, even those letters would not have arrived in my post bag.

Mr. Blunkett: I am sure that the hon. Gentleman would not even have received letters about the refugee children were it not for the fact that his constituents knew that, in order to meet that responsibility, which was perfectly reasonable, given the location of Heathrow airport.. their own services had to be cut. However, that is the prospect they face. It is a moral disgrace to ask the residents of a specific locality to pick up the bill for meeting such responsibilities and thus suffer reduced services. In order to fulfil their duty to the refugee children who come from around the world, Hillingdon residents inevitably have to suffer reduced services. They can do nothing about that, any more than the residents of Cheltenham can do anything about the land taken over from Tewkesbury, which has resulted in the cuts necessitated by the cap placed on them.
If it were not so serious it would be ridiculously funny to debate a £5 reduction in the bills of people in Hillingdon, £3 in Gloucester and £12 in Cheltenham.
The amount in Warwickshire is peanuts, though not in terms of cuts in services. All hon. Members arid all commentators know that it is daft. Eight authorities are

being capped to reduce by a tiny fraction the amount raised by local people. Neither electors, chambers of commerce and trade, newspapers, parents, MPs nor councillors in Warwickshire agree with Warwickshire being capped.

Sir Dudley Smith: I do not like to agree with the hon. Gentleman, but he is absolutely right. There is unanimity among all the political parties and everybody in local government.

Mr. Blunkett: The irony is that the only people who are in favour of Warwickshire being capped are those who do not have to live there. Those people are not worried about the day-to-day policing of the streets and do not share the concern of parents of schoolchildren or the anxiety of elderly people who need to be cared for in residential homes or by home helps in their own homes. They are not concerned about the quality of fire cover. The same applies to Gloucestershire, which is hardly the most profligate authority in Britain. Hillingdon, Warwickshire and, of course, Basildon are Conservative authorities. What about Basildon?

Mrs. Teresa Gorman: Will the hon. Gentleman give way?

Mr. Blunkett: I shall give way to the hon. Member for the Billericay tendency.

Mrs. Gorman: In Basildon the cap will mean savings of £41 per charge payer per year. They would have had to pay a very high £361. That saving is welcome. We are spending the money not on such worthy causes as refugee children but on sports and parks facilities on which Basildon spends £32 per head per year. The average for the country is about £10. Those are the sort of facilities on which Basildon wasted money, and the people of Billericay and Basildon are delighted at the cap.

Mr. Blunkett: The voters of Basildon exercised their right to vote and elected a Tory council. That is democracy. The new leader of Basildon council can hardly be described as a wet. His local papers are already calling for his resignation for his incompetence in handling the closure of the local theatre. For the Billericay and Basildon tendencies theatres are persona non grata. The idea of culture has not yet filtered down to Basildon from the Department of National Heritage. Perhaps the new Secretary of State will step in to ensure that the measly £3,000 which would have kept the theatre open for an extra week to allow a children's production to be held is made available. [Interruption.] A Conservative Member says that we should shed tears. The town manager of Basildon said after the election that meeting the cuts would be devastating for Basildon. That could hardly be described as a reflection of socialist fervour. The idea that welfare rights and advice centres, youth services and facilities for the disabled that are not available from the county should not be cut should not be dismissed by sneers about tears. The people who will feel those cuts will not see anything to sneer about. But that is what the people of Basildon voted for, although on 21 May even the leader of Basildon council agreed that if the cuts had to be implemented on the basis of the original cap it would be "Goodbye Basildon".

Mr. James Hill: Nonsense.

Mr. Blunkett: I did not say goodbye Basildon: it was said by the hon. Gentleman's colleague, the leader of the Conservative council. I was not surprised that the hon. Member for Basildon (Mr. Amess) welcomed the £7 million cut that his friends in the Conservative council have vigorously tried to resist now that they are in power. The hon. Member for Basildon welcomed the announcement that Basildon would have to contribute to the poll tax safety net, not understanding that locally raised money would be given away.
Conservatives are so well versed in local government finance that they are engaged in flights of fancy, such as commending to the Prime Minister the new airline agreement for Europe. Many of them are up in the air and flying away rather than having their feet on the ground and being concerned about policing, safe, clean and acceptable streets, and comfortable and safe neighbourhoods in which to live. We have not spoken enough about protecting people from an increasingly brutish and unacceptable society in which self-interest rather than self-reliance has been the order of the day. There is litter and filth and graffiti and people fear to walk on our streets at night.
In addition to education and care for our children and those in social service care and a desire for decent leisure and cultural facilities, we are interested in a civilised and decent society in which people can walk safely on the streets. Cutting policing in Warwickshire or Gloucestershire does not help one iota towards that aim. As my hon. Friend the Member for Greenwich (Mr. Raynsford) has said, such aims are not helped by penalising an authority and making it impose more cuts because, compared with neighbouring boroughs, it got a poor standard spending assessment for the provision of children's services. Conservative Members spoke about provision in Lewisham. Wandsworth receives almost double the amount per person for children's services that is allocated to Greenwich.
At the Adam Smith Institute the Prime Minister spoke about expectations in schools. They were wise words and would have been commendable and taken seriously if, at the same time as the Prime Minister spoke about parachuting teachers to inner-city schools and increasing expenditure on them, his capping regime and his formula funding mechanisms were not cutting the spending on such schools and preventing increased expectation by parents and improved education for children. Greenwich spends £7 million more than its standard spending assessment on education. The same amount above the Government's SSA has been spent on social services in Lambeth, but the borough is expected to cut that amount in order to meet some centrally determined preconception of what should be spent on local people.
It is time for a return to a bit of basic democracy, the kind of thing that is commonplace on the continent where nobody holds councillors in the contempt in which they are held by the Government and Conservative Members. People on the continent respect local democracy and accept the right of local people and their representatives to decide what is right for them. It is short-sighted and centralist and Delorsian in its corporatism and in its harking back to the past to continue the capping regime and the diktats of central Government. That is why we are opposing the order. That is why we believe that capping is fatally flawed. That is why we believe that at some stage in the future, despite the best efforts of the continuing regime

in Westminster and Whitehall, we shall return to a position where decentralised and devolved local government, with real subsidiarity, will be able to take decisions on behalf of local people—local people will have voted for it—and there will be respect for that local democracy, which is the life blood of any civilised society.

Mr. Michael Shersby: The decision of my right hon. and learned Friend the Secretary of State for the Environment to cap Hillingdon, in which my constituency is situated, is both unnecessary and unjustified. Hillingdon's original budget was £167,140,000 and the cap proposed by my right hon. and learned Friend is £166,270,000. In other words, it is proposed that Hillingdon should spend £870,000 less than that it had planned, despite the fact that my right hon. and learned Friend knows that the borough faces extraordinary items of expenditure which are not of its own making but are the direct consequences of national policies. Those items include the costs of caring for 31 unaccompanied refugee children from Ethiopia, Uganda, Angola and the territory of Eritrea. I heard today that there are now another five children from Zaire and Afghanistan. The cost to Hillingdon of caring for these children last year was £936,000, a substantial sum and one that is in excess of the amount by which Hillingdon is being requested to reduce its expenditure.
My hon. Friend the Minister for Local Government and Inner Cities knows that, because of the outstanding and unique success of Hillingdon in 15 per cent. of its schools applying for and achieving grant maintained status—more than any other local authority in the United Kingdom—the allocation of funds through the schools formula will mean that Hillingdon will lose another £1 million. That is because the allocation of funds is based on central costs of 16 per cent. of the aggregated schools budget. In effect, this means that GM schools will receive the same cash amount for 1992–93 as they would have been eligible to receive under the old rules when they were local education authority schools.
As the LEA has fewer funds with which to do its job, it has to cut its staff costs. By the end of 1991–92, Hillingdon's education department had shrunk by 78 posts, from 216 to 138. The savings achieved for 1992–93 as a result are £6.17 million. There are now only 120 staff in post in the education department. But still Hillingdon loses £1 million as a result of the formula, which has been rigidly applied.
My hon. Friend the Minister for Local Government and Inner Cities knows all about this. As he has told the House, together with my hon. Friends the Members for Hayes and Harlington (Mr. Dicks) and for Ruislip—Northwood (Mr. Wilkinson), I went to see my right hon. Friend the Prime Minister on 18 February to acquaint him with the situation which we foresaw. We wished especially to emphasise the problem that Hillingdon faces in caring for unaccompanied children who are literally dumped at Heathrow and who have to be looked after. We wanted my right hon. Friend to know also of the difficulties that result from the financial formula that affects grant-maintained schools.
My right hon. Friend the Prime Minister was extremely sympathetic and understanding. He understood the problem immediately. As a result, he arranged for a


delegation from Hillingdon to see my right hon. Friend the Member for Henley (Mr. Heseltine), who was then the Secretary of State for the Environment. Hillingdon was obliged, due to the extraordinary items of expenditure to which I have referred, to reduce its expenditure by the amount referred to by my hon. Friend the Minister for Local Government and Inner Cities. It had to do so as a result of policies that the Government had implemented.
My hon. Friends the Members for Hayes and Harlington and for Ruislip—Northwood have made it clear in interventions—I am about to emphasise the point —that Hillingdon has an outstanding record. Since the Conservative group came to office in May 1990, with a majority of only one, it has reduced expenditure by £30 million. It has also reduced staff posts by about 1,400. I suggest that that is a truly remarkable record. It has put the borough council's finances on a sound footing. The community charge, which is £295, is by no means excessive.
Why is it that my right hon. and learned Friend the Secretary of State seems to think that Hillingdon is spending so much? I suppose it must be because of the shining example that is set by his Department in keeping down its running costs. We can only assume that it is under firm control and observing strict disciplines and that my right hon. and learned Friend is anxious to pass on the example to Hillingdon. It seems that my hon. Friend the Minister for Local Government and Inner Cities has this message for Hillingdon: "At all costs you must cut your expenditure by £870,000 and adhere to the same strict disciplines that I am imposing on my Department in Marsham street."
As the House will know, for the past nine years I have been a member of the Public Accounts Committee. That has caused me, like you, Mr. Deputy Speaker, to develop an inquiring mind about the cost of running central Government. Economy, efficiency and effectiveness are the watchwords of the denizens of Committee Room 16, who meet twice a week to take evidence from witnesses from the Department of the Environment and elsewhere.
I have been doing some work on my own account. I have examined the central running costs of the Department of the Environment to see how it is setting the magnificent example that it wants Hillingdon to follow. What do I find? I find that at constant prices expenditure increased from £172 million in 1990–91 to £193 million in 1991–92. It is planned to increase expenditure still further to £202 million in 1992–93. My right hon. and learned Friend's Department increased its expenditure by no less than 12.3 per cent. in 1990–91. If we take the total running costs of the Department, including those of the Property Services Agency and the Office of Water Services, at 1992–93 prices, the cost to taxpayers, including those in Hillingdon, increased from £212 million in 1990–91 to a massive £256 million in 1991–92, an increase of 20.5 per cent.
Then there are staff costs. Hillingdon is being told, like other local authorities, that it must keep down its staff costs, despite the fact that it has already shed 1,400 staff. The Department says that that reduction is not enough. What is the Department doing? What example is it setting for us? I find that the Department's staff has increased from 5,930 in 1987–88 to 6,425 in 1991–92. I wonder what has happened to the envelope that my right hon. Friend the Member for Henley, who is now the President of the Board of Trade, gave to his permanent secretary when he

took office. It seems that it has been lost. It does not appear that my right hon. and learned Friend the Secretary of State is doing very much to set an example for local authorities by curbing expenditure on excessive staff costs.

Mr. Wilshire: This is riveting stuff. Does my hon. Friend agree that he is making a case for capping the Government as well as local government? If that is so, I am happy to support him.

Mr. Shersby: I am grateful to my hon. Friend for his intervention.
Unfortunately, worse is to come. One of the central problems facing Hillingdon is the schools formula and the way that it is working for GM schools. I have examined the expenditure of the Department for Education and its staffing. I find that its staff has increased by 288 since 1987 to this year.
I invite the House to consider the costs that Hillingdon will incur in setting a new budget. I was told today by the director of finance that the cost of rebilling will be £165,000. That, too, has to be found out of the capped budget. What will the community charge payers of Hillingdon gain from being capped? The answer is £4.86, which is 1.3p a day—hardly worth the effort, I suggest.
The Minister is gravely in error in capping Hillingdon. Nothing much will be gained as a result of his decision and a great deal will be lost. I invite him to consider the effect of his decision on the morale of my colleagues on Hillingdon borough council who, for the past two years, have had to take the most difficult decisions in order to achieve very considerable improvements in the public service and in the financing of the borough. Something else will be lost—my vote in the Division Lobby tonight.

Mr. John Fraser: I begin with a few words about the annual argument that we have about local government. The distribution of democratic power in this country is between central Government and local government. In other nations there are different balances —in the United States between the federal Government and individual states and in Germany between the federal Government and the lander. The division of democratic power here between central Government and local government ought to be a matter of constitutional agreement that rises above disputes between the parties. Since this Government came to power in 1979, there have been about 50 statutes regulating local government. There ought to be a constitutional separation of powers upon which we can all agree. There ought not to be continual arguments in the House about interference with another tier of government. If I judge rightly the mood of the House, there is consensus about the degree of independence of local government in these matters. The odd person out is the person representing central Government.

Mrs. Gorman: Not a bit of it.

Mr. Fraser: We have just listened to the speech of the hon. Member for Uxbridge (Mr. Shersby), who gave the impression that neither he nor some of his colleagues intend to support the Minister 100 per cent. Matters relating to the constitutional division of power ought to be ones on which the House and the parties can agree. We


should not continually be resurrecting the body of local government and digging up the tree by the roots, if that is not too much of a mixed metaphor.
My borough of Lambeth set a budget of £333 million. The Government believe that its budget should be reduced to £328 million, a reduction of £4.4 million, or a reduction in poll tax of about 50p a week for the people living in the borough. The saving would be less than 50p a week because of poll tax reduction schemes and rebates. One is not, therefore, talking about a great deal of money.
The Department of the Environment increased Lambeth's standard spending assessment by £20 million, but the capping exercise has restricted the increase in its expenditure to £17 million. If the order is approved, Lambeth's poll tax will be reduced from £448 to £422 per person. In absolute terms, a poll tax of £448 is too high. It impoverishes the area by taking money out of the local economy. It is particularly harsh on relatively poor, elderly, single people living on their own who, as a result of the Government's machinations, pay substantially more than is paid by their affluent neighbours.
That level of poll tax leads to anti-social habits, such as evasion. When people get into the habit of evading their public duty of paying the poll tax, the habit tends to spread into other areas. My biggest argument against the poll tax is that it begins to undermine people's relationship with local government and with the state. Eventually it could lead to criminal activity. The Government had to accept that it was so destructive that they had to abolish it.
I do not believe that at this time of the year, coming up to July, it is worth while to cut the poll tax. At the very most, the effect on poll tax payers would be marginal—a reduction of 50p at the most. My experience—and I believe it to be the experience of most other hon. Members —is that there has been little lobbying against the current level of poll tax, as against the level that the Government propose. Since the effect on poll tax payers will be marginal, it seems to me to be plain crazy to alter the level of local taxation when we are at least a quarter of the way through the financial year.
The effect, however, on those who consume services —this is particularly true of education—will not be marginal. It will be both deep and severe. The effect of the capping order on the revenue that is collected by way of the poll tax will be huge. There will be irreparable losses as revised bills are sent out and as frustration over the continuously revised poll tax translates itself into non-payment. Bad debt—irrecoverable poll tax—will be the consequence of asking Lambeth to rebill and recap its rebates. It will throw the present collection system—which is beginning to work reasonably well in my borough—into confusion.
Two alternatives could have been proposed. The first is to allow councils such as Lambeth to write off their bad, irrecoverable debt without treating it as expenditure.

Mr. Redwood: Whew!

Mr. Fraser: The Minister says "Whew!". When the Government wanted to sell British Airways—when the private investor was to get his sticky hands on British Airways—what did the Government do? They wrote off bad and irrecoverable debt. If the Minister says "Whew!" like that, can he tell us whether the Government intend to

write off bad and irrecoverable debt when they sell off British Coal in order to allow the private investor to get his sticky fingers on British Coal?

Mr. Roy Thomason: Will the hon. Gentleman give way?

Mr. Fraser: No, because a lot of hon. Members want to speak in the debate. It would be better, therefore, if I did not give way.
When it came to selling off British Steel, did not the Government write off bad and irrecoverable debt? The same applies to Rolls-Royce. I do not know, therefore, why the Minister said "Whew!"
The right thing to do is to allow boroughs to get rid of their bad and irrecoverable debt, which is largely the result of rate penalties. When we had the rate penalty system, if a tenant moonlighted owing £1 in rent and it was written off, it counted as expenditure and the local authority lost £1.60 in grant. That was the result of central Government's interference with local government finance. Consequently, local authorities throughout the country kept the bad debt on their books. The consequence of writing it off was that it would count as expenditure and would lead to even greater penalties than the level of debt that was being written off.
The second alternative is that the Government should recognise and accept the truth about the population of the borough of Lambeth and the realities of collecting poll tax. I accuse the Government of ignoring the truth about the population of Lambeth and of ignoring the borough's ability to collect in order to stigmatise the borough. I know that not everything is perfect in Lambeth. I do not represent the borough; I represent the people of Lambeth.
Let me give an illustration of how the Government have ignored the realities. The Office of Population Censuses and Surveys states that the adult population of my borough is 180,000. The first results of the 1991 census showed that Lambeth had an adult population of 179,000, or thereabouts. That is almost exactly the same as Lambeth's estimate of its own population but, without any figures to back them up, the Government say that the adult population of Lambeth liable to pay the poll tax is 189,630. They calculate that there are 10,000 more people than the Office of Population Censuses and Surveys estimates and 10,000 more than appeared on the 1991 census. With a poll tax of about £422 to £448 a year, the missing 9,000 people represent £4 million of imputed income, which is almost exactly the amount of the Government cap in the order. If the Government were to believe their own statistics, their own census and their own OPCS, we should not need to discuss the order. The Government are denying us the money because their population figures are wrong, but ours are right.
We could reduce the poll tax substantially if the Government would recognise the problems of collecting the poll tax in a borough where 40 per cent. of all public sector tenants live on the poverty line, and in which 25 per cent. of the total population live on the poverty line. The 20 per cent. rule also makes it especially difficult to collect the poll tax. If the Government recognised the difficulty of collecting the poll tax, which was the underlying reason for abolishing that tax, they would accept our figure of about 82 per cent. collection rates. If the Government were to accept our figures for the population and for the collection


rates, we could cut our poll tax by £74 per person, which is much greater than the 50p a week which will result from the order.
I conclude by giving three more reasons to oppose the order. First, as many hon. Members have said, it is undemocratic. If people are not content with the level of the poll tax or with their local services, they will have a simple solution in two years' time: they can get rid of councils with which they are not satisfied. There is growing evidence that the choices that people are making in local government elections are independent of those that they make in national elections.
I admit that the Minister spent five minutes talking to me behind the Speaker's Chair and listened to my views, but he refused to meet local government officers, a delegation from the local community, voluntary groups or churches. The police also wanted to talk to him, but he refused to meet any of those people and has overridden any local views except those of the leadership of the local council. That is wrong and it ignores the local democratic view and public opinion. After all, the results of the level of poll tax and of the conduct of our local authority led not to a backlash against Labour but to the loss of the Tory seat in Streatham only a few months ago.
Secondly, the order means a waste and a loss of revenue. It will cost about a quarter of a million pounds to rebill and to recalculate rebates in a borough which has such a high level of poverty and where there are so many rebates to be recalculated. That alone will cost about a quarter of a million pounds, but a bigger loss of revenue will come from the confusion that will result from rebilling. That will mean that millions of pounds will be lost, so the cap implies not only an explicit cut in expenditure of £4 million in the current year but serious cuts in the future as irrecoverable poll tax has to be written off as a result of the order.
The order devalues and dilutes the council's revenue for future years. That means that in the future a child or some children somewhere in my borough will not go to medical school or law school or become an artist or a creator because the amount spent on their education in my borough will have been cut as a result of the loss of revenue arising from this order. That is already happening in every London borough. The amount spent on children's education is reduced because of bad debts which were incurred before they were even born—

Mrs. Gorman: It is because people do not pay their rent.

Mr. Fraser: No, it has nothing to do with that. The hon. Lady should tell us why the amount spent on the education of a child of five in my borough should be reduced because of rent which a tenant did not pay eight years ago. Why should a child who is now four or five years old be penalised because of a debt which is now irrecoverable and which was incurred more than five years ago? That is the result of the way in which education is financed. It is also a result of the abolition of the Inner London education authority and the consequence of lumping the problems of London boroughs and their old debts together with other provisions.
The third reason to oppose the order is the cuts themselves. Lambeth had not planned to increase its spending greatly. It plans to spend an extra £4.4 million on education and an extra £1.6 million on social services. We read in the Evening Standard tonight that children in

London are at greater risk of drug and child abuse than in any other part of the country. Lambeth also plans to spend about £50,000 extra on the disabled.
As a result of the cuts, the passport out of poverty provided by education will be curtailed to some extent because, in a borough such as Lambeth, education is the value-added element which can be added to a child's basic assets. The lives and opportunities of young people, children and the disabled will be adversely affected. I do not think that playing with people's lives is worth 50p or less a week.

Mr. Alan Howarth: I have sought to catch your eye, Mr. Deputy Speaker, out of sad necessity. I regret very much that Warwickshire has been capped. It is not an authority which has sought to confront the Government; it is not loony or extravagant but is a well-run Conservative-controlled authority, committed to providing a proper level of services on a cost-effective basis. The quality of its management has been praised by the Audit Commission whose opinion, I believe, the Government hold in some regard.
In Warwickshire we certainly understand the need for economy in the public finances, and Warwickshire county council has not sought to impose excessive burdens on its charge payers. Indeed, the increase in its precept since the introduction of the community charge has been the ninth lowest of any county council. But Warwickshire is being capped. That is because the Government's standard spending assessment understates Warwickshire's needs.
Warwickshire's needs are certainly no less than the average. Sadly, mortgage repossessions and infant mortality are above the county council average. Household disposable income and gross domestic product per household are below the county council average. That is recognised by the Minister's colleagues in the Department of Trade and Industry and by the European Community in no fewer than three different programmes. Nearly half the population of Warwickshire lives in priority areas as defined by the DTI or the European Community. In the case of the European Community, Warwickshire is eighth out of the thirty-nine English county councils with regard to the proportion of the population in objective 2 areas. However, according to the Department of the Environment's assessment of need, Warwickshire is thirty-fifth out of 39 authorities.
Why is the Department of the Environment's assessment of Warwickshire's needs so peculiar? I cannot believe that my hon. Friend the Minister of State, of all people, is lagging behind the European Commissioners in common sense and realism. The explanation is that he has inherited responsibility for a system that places excessive weight on a restricted range of indicators of need. I shall outline briefly two distortions and one confusion in this massive system.
The area cost adjustment is intended to compensate local authorities for the costs of employment in the south-east of England. We in Warwickshire submit that the new earnings survey is an inappropriate guide. A high proportion of local authority labour costs are centrally determined, and there is little real flexibility for local authorities in respect of pay—for example, in the cases of the police, of fire fighters and of teachers.
I am glad that my former colleagues in the Department of Education and Science managed to achieve a pay review body for teachers and that its recommendations have been accepted. However, if the Government will the ends, they must also will the means. It is not reasonable to require Warwickshire's education budget, already desperately stretched, to be cut in other aspects to enable the authority to honour that commitment.
There is an arbitrarily drawn frontier between the charmed area of the south-east, which benefits from the area cost adjustment, and the rest of the country. Unfortunately for us in Warwickshire, the boundary is drawn along the Oxfordshire-Warwickshire border. If we were in Oxfordshire, we should receive an extra £15.2 million, and then we would have no problems with our budget.
In different capacities I have had the opportunity to study the additional educational needs element in the formula at close quarters, and in my judgment it has two faults. The first is that the three indices of social deprivation on which it is based are too narrowly selected. In truth, additional educational needs, as defined by people of common sense, are diverse and pervade the whole school population. The weighting attached to additional educational needs in the standard spending assessment is excessive—22.5 per cent.—so that too high a proportion of resources is allocated according to socio-economic factors rather than according to pupil numbers. The result is underfunding of basic provision across the country. The cost to Warwickshire of the introduction of the additional educational needs element was £6.7 million in 1990–91.
As my hon. Friend the Minister knows, I have been a member of the ministerial team for "Action for Cities", and I fully share the Government's commitment to finding effective ways to bring better services to people in inner cities and to improve the quality of life there. But I question—as, I suspect, does my hon. Friend—whether massive transfers of resources from the shire counties are really the right way to achieve that. In Warwickshire the effect has certainly been to take from a county which is efficiently managed but austerely financed. I have no ill will towards Birmingham—although I admire Warwickshire's concept of education service delivery rather more than that of Birmingham—but we find it galling that Birmingham city council does not even spend up to its education SSA.

Sir Dudley Smith: My hon. Friend is making a powerful case, as is clear when he talks about the inner cities problem, but will he ally with that case what he said earlier —that less deserving shire counties, too, are getting more than Warwickshire?

Mr. Howarth: My hon. Friend is taking us back to the area cost adjustment consideration, and I certainly do not disagree with him about that.
The weighting of the additional educational needs element has been somewhat reduced within the overall system. I understand the political difficulties in taking the process further, but I believe that my right hon. and hon. Friends in the Department of the Environment and the Department for Education should consider it further, because injustices and impracticalities are built into the formula.
The confusion which I mentioned earlier consists in the contradictory requirements of different Whitehall Departments. I mentioned teachers' pay, and I shall cite one other instance. The Home Office requires Warwickshire to spend more than it does on the fire and rescue service, whereas the DOE insists that it should spend less. The budget is £2.4 million, or 32 per cent., above its fire SSA, yet Warwickshire's expenditure remains below the minimum on which the Home Office insists. We have received stern admonition from Her Majesty's inspector and from Home Office Ministers, yet when Warwickshire attempts to meet the Home Office requirements we find ourselves capped.
I ask the Minister of State, as I have already asked my right hon. and hon. Friends in the Home Office, to deal with this flat contradiction which places Warwickshire councillors in an impossible position and causes my constituents to suffer. I hope that the Minister will not simply accept that there is an impasse between those two massive Departments of State.
I could say more about the technical features of the system which operates so powerfully to the detriment of Warwickshire, but the case has been strongly set out and powerfully substantiated in a two-volume submission by the county which I commend to a wider readership. The issues raised in Warwickshire's case are issues of principle, and of national concern.
If the system of SSAs is to command respect, the anomalies within it and the damage that they cause must be eradicated. It will not do to plead, as the Government did last year, the overriding need for stability—because such stability means a perpetuation of injustice.
In the meantime, I am grateful to my hon. Friend the Minister and to my right hon. and learned Friend the Secretary of State for listening to and responding to Warwickshire's case. I believe that my hon. Friend recognises that the present position is not intellectually acceptable nor politically presentable, and I know him well enough to know that he cannot be satisfied with such a state of affairs.
The £4 million increase in Warwickshire's budget permitted under the order is a significant improvement for the county. But I remind my hon. Friend that it still leaves the county £3 million short of the expenditure that a responsible Conservative-controlled county council believed was the minimum appropriate budget. Already our education and youth services have suffered severely, and the police are experiencing the greatest difficulty in providing the service which the Home Office requires, which they wish to provide and which my constituents want from them.
The charge that the council has to make for home helps has risen by 25 per cent. above the rate of inflation, and something similar has happened with meals on wheels. Charges for lunches in old people's luncheon clubs are rising by even more than that. I recently visited the Earlswood senior citizens luncheon club, where people were incensed, but also bewildered and hurt, by the 50 per cent. increase in the cost of their luncheons.
The Government have implicitly conceded the inadequacies of the SSA for Warwickshire. The cap was lifted by £2.8 million last year, and between last year and this year formula adjustments have given us another £1.3 million. Now the Government have enabled us to spend an additional £4 million. They must now follow through the implications of that analysis and those decisions.
I shall vote for the order, because I shall not vote against an increase of £4 million for my county, but I ask my hon. Friend the Minister to recognise the disruption, damage and distress suffered in Warwickshire last year and again this year. It would be intolerable to have to repeat that experience for yet another year. The waste of time, energy, money and emotion involved in such proceedings is deplorable, and the sheer unfairness is unacceptable. I urge the Government to embark upon a thorough review of the standard spending assessment now, in the interests of justice and of good government.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse): Order. I inform the House that no fewer than 14 hon. Members hope to catch my eye. It would appear that some of them will be disappointed, but it would be helpful if hon. Members were to bear that in mind and to make their speeches as brief as possible.

Mr. Bill Olner: I shall try to be brief, Mr. Deputy Speaker.
When the Minister began to speak, there were so many Conservative interventions that I thought for a moment that I was watching a re-run of "Yes, Minister". I am sorry to see him sitting all alone on the Front Bench.
The issue that we are discussing is fundamental to the welfare of my constituents and the people of Warwickshire in general. The hon. Member for Stratford-on-Avon (Mr. Howarth) spoke of the £4 million that the Government are contributing, but one could be forgiven for saying that they are contributing nothing at all. The elected members of Conservative-controlled Warwickshire county council have determined the level of service that is needed, and, although I consider their estimate far too low, they decided that £299 million was the amount required to provide that service.
That money is being collected. It began to be collected in April or May. I have received no letters from constituents saying that they are paying too much—although I have received plenty of letters from elderly people whose meals-on-wheels charges have risen by 50 per cent., and in some rural areas the service has been disbanded. Home-help charges have risen by some 25 per cent. It does the Government no good to become involved in horse trading. There is no rhyme or reason for their failure to accept the excellent document presented to them by Warwickshire county councillors, who made some good points when they arrived in a deputation attended by all Warwickshire Members.
I do not understand why the Government have relaxed their restrictions by only £4 million. I hope that all my hon. Friends representing Warwickshire will support the amendment that I have tabled with my hon. Friend the Member for Warwickshire, North (Mr. O'Brien) because it goes back to the original principle that local democracy means elected members determining the level of service that is required, along with the people whom they represent. That is patently not happening now.
The main problem is the standard spending assessment. As others have pointed out, Warwickshire county council was poll tax capped not only this year but last year. The

formula has been wrong from the beginning, and I fear that nothing will be done to correct it in future years. The Government's £4 million is no more than a relaxation.
In the past few years, Warwickshire has cut more than £13 million from its budgets. That has meant an enormous reduction in education and youth service facilities, and there is still a shortfall. Warwickshire councillors will have to exercise the wisdom of Solomon if the motion is passed; in determining that shortfall I hope that my amendment will be accepted, so that the council can set the budget that it agreed.
There is a £4.2 million shortfall in the education budget, a £1.5 million shortfall in the social services budget and a £1.4 million shortfall in the budget for transport and fire and rescue services. Those are only figures, of course, but there is more to it than that. Last week, I hoped to question the Minister for Health about the implications of the Children Act 1989; I understand that she is to receive a delegation from Warwickshire's social services department, and I trust that Warwickshire Members in particular will bear this in mind. Even with the increased funds mentioned by the Minister, the council will not have enough money to ensure that more than scant regard is paid to the implementation of the Children Act. It will be unable to move to the next stage of that implementation.
People in my area deserve better than this. Warwickshire is made up of five districts, many of which suffer from social deprivation. As has been mentioned, RECHAR money is payable in some of those districts. The county does not consist only of leafy Stratford-on-Avon, Kenilworth and Warwick; it has another side—the industrial side.
Warwickshire used to boast a thriving mining industry and a heavy engineering industry. Sadly, both those industries have been in decline for some time. It is now recognized—not only in the House but in Europe and the relevant agencies—that they need more money. The stranglehold of the standard spending assessment and all that it implies prevents my local authority from putting into practice policies that would create an additional economic stimulus.
I urge every hon. Member to vote against the motion —not because I do not welcome the £4 million, but because, if Warwickshire is to fulfil its obligations to its people, it needs the budget set by its Conservative county council. It needs £299 million.

Mr. Douglas French: The House gave my right hon. and learned Friend the Secretary of State for the Environment power to charge cap authorities on one of two grounds: that their budgets are excessive, or that the increase in those budgets in relation to the previous year is excessive. In his capping notice to the city of Gloucester —which I have the honour to represent—my right hon. and learned Friend said that his ground for capping was the fact that the increase in its budget between 1991–92 and 1992–93 was excessive.
How did my right hon. and learned Friend arrive at that view? He took the proposed budget figure of £10.343 million, compared it with the revenue support grant of £9.2 million for 1991–92 and then announced that that produced an increase of 12.4 per cent., which—by his standards—is excessive.
I would argue that the base line figure with which my right hon. and learned Friend should compare the proposed budget is £9.7 million rather than £9.2 million. I believe that he has wrongly applied the rules that he himself set. In 1991, the boundaries of the city of Gloucester were extended, and the city took in an extra 6,000 people who had previously been in Stroud and Tewkesbury. It became Gloucester's responsibility to look after those 6,000 people, and its charge-paying population was effectively increased by 9 per cent.
I entirely accept that my right hon. and learned Friend calculated Gloucester's SSA for 1992–93 to reflect the boundary change. I do not dispute that the calculation reflects the increased population's spending needs. The SSA, however, is not the issue; the issue is the way in which the base line is calculated. The question is, where did the money come from to provide services for those 6,000 people in 1991–92, the year in which the transfer took place?
It would have been possible for the Department to increase the council's revenue support grant. There was time for it to do that, but it did not. Had that been done, the present argument would not have arisen: the base line expenditure figure would have been unambiguously £9.7 million. Instead, the districts agreed on an inter-district transfer of £510,000 to Gloucester, which was designed to cover the spending requirements of those 6,000 people.
That transfer was made with the full approval of the Secretary of State and in accordance with the guidelines set down by him. For all practical purposes, therefore, this was revenue support grant, but it was received indirectly, via another council. If it had been retained by the council from which it came, it would have been treated as revenue support grant. So it was not extra expenditure in any sense. It was money spent by Gloucester that would otherwise have been spent by Stroud and Tewkesbury, and would, of course, have been included in those authorities' base-line calculations.
To Gloucester's original budget of £9.2 million was added £510,000, making £9.7 million in all—but with one difference: under the rules, the amount was paid into the council's general fund and had to be treated as -other income". The result was that the section 95(4) calculation, which is used by the Secretary of State in his year-on-year comparisons, was artificially reduced by £510,000. If the money representing the rate support grant had been treated as rate support grant, the council's section 95(4) calculation base line would have been £9.7 million.
So the question is "What was the amount of money spent by Gloucester in 1991–92?" because that is the yardstick for judging whether the 1992–93 expenditure is or is not excessive. Was it the original figure of £9.2 million, before any population transfer took place? My right hon. and learned Friend thinks that it was. He takes £9.2 million as the base line and argues that a proposed budget of £10.343 million represents an increase of 12.4 per cent. That breaches his guidelines and therefore triggers the cap.
My right hon. and learned Friend and I agree on one thing: the figure of £9.2 million is the one that would have been correct if no population had been transferred; there is no doubt about that. My right hon. and learned Friend believes, however, that the same figure was correct as a

base line even after population change funds had been transferred and spent. In my opinion, that is illogical, unfair and absurd. It is absurd to take the same base-line figure for two different sets of circumstances.
I shall not invite my hon. Friend the Minister to consider where my right hon. and learned Friend's methodology would lead if, instead of the population increase being 9 per cent., it had been 99 per cent. Would he then stick to his unadjusted base-line system? That simple illustration shows that there is a flaw in my right hon. and learned Friend's approach.
Is it not common sense that, because the £510,000 was transferred in respect of the 6,000 people, it should be deemed to be a legitimate addition to Gloucester council's 1991–92 budget? Gloucester did not spend £9.2 million in that year; it spent £9.7 million, with the Secretary of State's approval. It seems reasonable, therefore, that it should be able to apply a 6.5 per cent. increase to the £9.7 million and propose a budget of £10.343 million.
That seems reasonable now and it seemed reasonable when the council did it. But the city of Gloucester took no chances. It took vigorous steps to discover the Secretary of State's views in respect of the effect of boundary changes on budgets. The council wrote to the Department several times seeking clarification. In a letter about charge capping dated 17 December, the Department replied:
As far as the Secretary of State's intentions for charge capping for 1992/93 are concerned you will be aware that the paper circulated to all local authorities on 26 November …stated that 'the Secretary of State … intends to consider the effects of boundary changes on authorities' budgets for 1991/92 and 1992/93.' That remains the position.
The letter continued, with respect to capping:
As the Secretary of State made clear in his statement to the House of Commons on 26 November, his intentions are at present firm but necessarily provisional.
That is not exactly a model of clarity, but one accepts that obfuscation is sometimes a necessary instrument of Government.
Admittedly, that letter does not say that the Secretary of State intends to make full allowances for the boundary changes, but it emphatically does not say that he intends to make no allowances for them whatever.
In the event, the letter of 17 December was not sent to Gloucester city council until 11 March. With it came a covering letter, which said:
This letter"—
meaning the letter of 17 December—
actually from this office"—
one wonders where else it might come from—
appears never to have been sent. I therefore enclose a copy, with apologies for this oversight.
By 11 March, the Department must have known that the budget-making process was not only well advanced but probably already accomplished. Whatever grounds for lack of clarity there may have been in November and December, the time for a clear decision had surely arrived by the middle of March. If it was the intention to treat the budget as if no population change had ever been made, it was time to say so, but the opportunity was not taken. I submit that the covering letter could and should have said that the Secretary of State had decided that no account would be taken of the money spent in respect of the additional population. It did not do so, even though the writer of the letter must have known that that was the information that Gloucester city council would need to know. Nor did the author of the letter show any sign of


appreciating that there would come a point—in fact, that, there had come a point at that stage—at which further failure to set a budget would become an offence.
I submit that, if a clear and unequivocal statement had been made, at that time or earlier, to the effect that the £510,000 that had been spent must be treated as if it had not been spent, we would not be discussing this subject tonight, because Gloucester would have followed the instructions that it had been given. Members and officers of Gloucester city council from all parties believed that they were acting in accordance with the rules set down by the Secretary of State. One of the things on which we have cross-party agreement on Gloucester city council is that there was no intention to breach the capping guidelines. Indeed, there is abundant evidence in council correspondence and council minutes that the council had no intention whatever of breaching the rules. It was the council's wish and intention to keep within them. Why else would the council have had lengthy debates to that end? The council was debating not by how much it should seek to breach the guidelines but how to trim its budget to ensure that it was within the guidelines and did not run the risk of being capped. That is in keeping with the tradition of a prudent authority, which is what Gloucester has been. It has not been profligate or irresponsible. One may sometimes argue about the particular headings of expenditure priorities that it chooses, but, overall, it is a prudent authority.
It was not until the council received the notice of designation on 14 May 1992 that it became aware that the Secretary of State had not taken account at all of the boundary changes. What became evident then was that, on the Secretary of State's offbeat and eccentric method of calculation, Gloucester had breached the capping guidelines. It is not simply my view or that of Gloucester city council that the method is offbeat and eccentric. Section 55 of the Local Government Finance Act 1992 refers to the designation of authorities from 1993 onwards making specific provision for including in budget comparisons an amount to recognise boundary changes. Parliament has clearly recognised that year-on-year comparisons of budgets which do not take into account boundary changes may well be unfair.
I thank my hon. Friend the Minister for Local Government and Inner Cities for listening to representations from Gloucester city council. However, I repeat to my right hon. and learned Friend the Secretary of State and to my hon. Friend the Minister that the city council has not been profligate. It is committed to economy and efficiency. The amount by which its proposed budget exceeds the SSA is less than 117 other district councils, many of which are spending considerably above their SSAs. However, they remain within the year-on-year yardstick and are therefore not caught by the provision.
Furthermore, the amount in question is £190,000 or £3 per head of population. Subject to the precise re-billing arrangements, the reduction in budget is likely to approach £300,000. To insist on a cap of £10.15 million in those circumstances is not a sound illustration of how to treat charge payers' money responsibly. It will disrupt the city's financial management and confer a stigma on the council marking it as irresponsible. It is also likely to prejudice the council's case for unitary status. I regard the cap as entirely unacceptable.
While I thank Ministers for listening courteously to my representations, and those of councillors, I record my profound dissatisfaction with the fact that Ministers have

not been persuaded by our arguments. Therefore, I regret that I cannot support the Government in the Lobbies tonight.

Mr. Nigel Jones: Snap: we in Cheltenham have exactly the same problem as that in the constituency of the hon. Member for Gloucester (Mr. French). I thank him for setting out his case so clearly and I will not bore the House by describing the experiences of Cheltenham borough council.
Cheltenham council has also kept to the SSA, but we have suffered a larger boundary change than that in Gloucester. An extra 20 per cent. has been added to our boundary. The good people of Leckhampton, Up Hatherley, The Reddings, Prestbury and Swindon village have been added to the responsibilities of the borough council. There was a similar transfer of funds from Tewkesbury to deal with that change last year. We have no quarrel with the Minister over the SSA. We are being capped on the year-on-year comparison of spending in exactly the same way as Gloucester.
By setting a budget to stay within the cap, much of the routine maintenance will be capitalised, thus removing it from the revenue budget. As a result, the town centre toilets will close. It will therefore be a very inconvenient place to be when the pubs close. Senior citizens' bus passes will be means-tested. I know of no one who fought for a place on Cheltenham borough council who placed such changes in their manifestos. However, the council must adopt such measures to save small amounts of money to get down to the capping limit.
I join the hon. Member for Gloucester in appealing to the Minister to reconsider the position in Gloucester and Cheltenham. If we consider all the councils that were brought under the capping threshold with budgets of less than £15 million, only Cheltenham and Gloucester have had boundary change problems. That bodes ill for the local government review. Those examples may make councils anxious that boundary changes might lead to their being capped in future.
I would like to pay the Minister a small tribute. I have been double-capped: Cheltenham borough council and Gloucestershire county council have both been capped. I took a delegation from Gloucestershire to meet the Minister. Hon. Members may recall that when the original capping legislation was announced by the Secretary of State on 14 May I asked him whether he would be genuinely open to persuasion by the councils affected and he said that he would be. I thank the Minister for being open with us. We believe that we had a fair hearing when we met him.
Gloucestershire had a powerful case which was made clearly by senior council members Frank Thompson and John Sewell, the chief executive Michael Honey and the county treasurer Richard Cockcroft. I thank the Minister for being genuinely open to the Gloucestershire appeal. I also thank him for the relaxation of the cap by £2.59 million.
I met senior officers and members of the council in Gloucester yesterday. Although there was no sense of euphoria, there was a feeling that the Minister had listened and they were grateful for that. It must have had some effect on them, because I am pleased to report that when


I attended the annual cricket match between Gloucester county council and Somerset county council, we won by 26 runs.
The question centres on the formula for calculating the SSA. Many of the calculations in the formula are based on the 1981 census. However, there have been great changes since then. There has been an increase in Gloucestershire in post-16 stay-on rates in our schools. That is remarkable and I am sure that the Government, like me, welcome that. We have also been very successful in statementing special educational needs. We have made great progress in that respect and some of our less fortunate children can now make more progress than they would otherwise.
Gloucestershire also now has a higher unemployment rate because of the rundown of defence needs following the end of the cold war. Although we all welcome the end of the cold war, we must find a new role for those people in the county who have been made unemployed as a result of that welcome move. There has been a 43 per cent. increase in free school meals in Gloucestershire and that costs money. The population in Gloucestershire has also been growing since 1981. Indeed, Gloucestershire was one of the boom counties of the 1980s.
The cuts which the county council had considered before the £2.59 million adjustment to the cap involved compulsory redundancies for teachers. We are reconsidering that to discover whether compulsory redundancies are now necessary. However, when I spoke to senior officers yesterday, they said that there would still have to be some compulsory redundancies. At one stage, it seemed that up to 200 jobs would be lost, although not all compulsorily and certainly not all full-time jobs. However, I know of no county councillor who was elected on the basis of a programme of making teachers redundant. I know of no school governor—and I am a governor of three schools in Cheltenham—who believes that making teachers redundant is a good idea.
The chief constable has also warned that 15 police posts would have to be held vacant despite the fact that since 1979 we have had a 237 per cent. increase in crime. Indeed, there was a 32 per cent. Increase—the third highest in the country—in 1991 alone.
Gloucestershire is a low spending authority. We spend less per head than the neighbouring counties of Warwickshire, Avon and Wiltshire and slightly more than Hereford and Worcester. We are way down the shire county average in respect of education spending.
During the formation of the budget and, indeed, during the general election, no one contacted me to complain about the level of the poll tax, but I was bombarded with letters from parents, elderly people and people who have no direct interest in education except they knew we should not make cuts. They all wanted us to maintain spending on education in Gloucestershire. They understood the argument because Gloucestershire has been forthcoming in passing the education budget to schools so that school governors have had to cope with their own budgets. They would have an informed debate not only among themselves but among parents and other people in the community.
At every public meeting that I held during the general election, I asked people whether they wanted us to cut spending on education, and they said no. I gave them the

other side of the argument, that if they wanted to maintain spending on education and on the police they must be prepared to pay for it. When I asked, "Are you prepared to pay for it?" without exception they said yes.
The difference between the new cap and the budget which the county council would like to spend is 5p a day for the standard poll tax payer or 1p a day for those on the 20 per cent. rate. The cost of rebilling throughout Cheltenham, Gloucester and the county council area might be up to £1 million. That is a waste of money. I should be grateful if the Minister would clarify whether the relaxation that has been announced for the three councils will raise their SSAs or allow higher spending this year. If it does not raise their SSAs, there will be significant problems next year.
I am not alone in questioning the principle of capping. Last week, I asked whether the Minister thought capping increased local accountability. It takes from elected councillors the right to carry out the programmes on which they were elected and it denies the people who elected them the high quality services for which they voted.

Mr. Terry Dicks: I shall be brief, because my hon. Friend the Member for Uxbridge (Mr. Shersby) made an effective speech outlining the situation regarding Hillingdon. Some would say that this charade is a dog's breakfast, but no dog in Hillingdon would eat such a mess as that which is provided by the Minister and his colleagues in the Department. For year after year, the nonsense coming out of the Department of the Environment with regard to local authorities has got worse. It is as bad as it could ever be.
The poll tax—the community charge—was to give local democracy a chance to work; if local authorities taxed highly, they would be turned out of office by the electorate. That is an excellent principle, and I voted for it. When we saw charge capping, which is contrary to that principle, it was said that it would give people the freedom to elect high-spending authorities or low-spending authorities. The minute some high-spending authorities came in, and we could have seen a change, what happened? The Government said, "We cannot have that. We will go against the principle on which we introduced the community charge, and introduce capping." That is the issue that we are discussing. The principle was right, but the implementation was worse than a dog's breakfast, and capping just makes nonsense of the situation.
Labour and Conservative Governments have continued to put statutory obligations on local authorities and then deny them the resources to meet those obligations. In Hillingdon, which is a port authority, we have homeless families coming in. We now have refugee kids. Although the Government have told us that we have to let them in, it is their responsibility. They say, "Hang on, Jack. We are telling you that you have to house them, but we are not allowing you to find the money to do it properly. We are not accepting our national responsibility."
One thing that I recommend to my authority, and I did so 14 years ago, is that the next refugee kids who come in should be dumped in Folkestone and Wokingham. Let the local authorities in the areas in which the Minister and the Secretary of State reside see how they cope when they have to put their hands into their pockets to feed, clothe and house those refugee kids. I am serious about this matter.


If the Government will not listen to reason and recognise the justice of our case, we will, unfortunately, have to take some action to make them aware. If we dump them in Wokingham in a couple of weeks and leave them outside the town hall, the Minister responsible will say, "This is a local responsibility, not a national responsibility. Although the Government control who comes into the country, you will understand why you should have them and bear your share." It is reasonable for the Minister to consider that point. If we do not do something drastic, the Government will go on only listening. I respect my hon. Friend the Minister for listening, but what is the point of listening and accepting the argument and then doing damn all about it afterwards? There is no point whatsoever.
My authority, Hillingdon, budgeted to cope with that national problem locally. It did as it was told. It raised money through local resources and then set it aside. That was not good enough for the Government. They said, "You have to find it locally; it is a local responsibility," although we thought that it was a national one. The minute we found the money and put it aside they said, "Oh no, no; we are going to cap you." We lose at both ends. It is like being stuck in the middle of the channel tunnel with a cork in each end. We cannot win.
As my hon. Friend the Member for Uxbridge has said, my local authority has done everything that the Government have wanted from it from day one in May 1990. It has made savings of £30 million and reduced staff by 1,400. It has acted faster than any other local authority in respect of grant-maintained status for schools. What do we get? We get one big kick up the backside from the Government for doing so. is it any wonder that my Tory colleagues on Hillingdon council say, "Why the hell do we bother"?
As my hon. Friend said, the public sector borrowing requirement is £28 billion. The Government have the audacity to say to Hillingdon, "You are £800,000 over the top." It is the Government's concern, but we are blamed for it. What sort of example is that? How can I say to my council colleagues, "Listen to the Government; theirs is the right advice on local issues; you must do as they say because they know best"? Know best? Like hell.
I have always said that perhaps we should get rid of the Foreign Office, because the Foreign Office acts in British interests only if they coincide with those of the Foreign Office. I have also said that, because the Treasury does not understand the difference between capital and revenue spending and abuses local authorities because of that, we should get rid of it. I have now arrived at the point at which I think that the Department of the Environment should join them. We should get rid of the three to start with—there will not be much left by the time I have finished. There is no logic in what the Government are doing with regard to local authorities.
My hon. Friend the Minister has said that he is a friend of local government and that he wants to continue as such. I have my doubts whether the Government really want local authorities to continue effectively and acceptably. I speak as somebody who has had nearly 14 years' experience as a local authority member. If we do not want to give local authorities the resources to do their job, and if local government legislation costs them money to meet their responsibilities, we should do away with local government altogether. Let us be honest about it. Do not let people become elected and work their whatsits off locally to make the right decisions and then slap a cap on

them and say, "It is for the benefit of this country." That is the biggest load of rubbish that any hon. Member could have to listen to. I say to my hon. Friend the Minister that he will not get me in the Lobby with him tonight.

Mr. John Austin-Walker: In the previous debate the Under-Secretary of State for Wales stressed the importance of decisions being based on up-to-date information. The evidence that was presented by the hon. Member for Norwood (Mr. Fraser) shows that decisions on standard spending assessments and capping have not been based on the most up-to-date information available.
Other hon. Members praised the Minister for having listened to the representations made by the various local authorities. He certainly gave the impression of listening when the London borough of Greenwich met him. But what has come out since has shown that he heard and understood nothing that was said about the way in which the SSAs were essentially flawed.
When the Government considered the implementation of SSAs they had a series of options. One would have given Hackney, for example, a poll tax of £48. An alternative option would have given it a poll tax of £606. I give that as an illustration of the arbitrary nature of SSAs. They are crucial to the decisions that are made. If the SSA for a particular service overestimates the required spending, the council is effectively overpaid. But if the SSA underestimates the required spending, as in the case of the London borough of Greenwich, the inevitable result is that services are cut or the poll tax is considerably increased. In the case of Greenwich, both have occurred.
Let me compare what has happened in Greenwich with what has happened in Westminster. The Government say that SSAs are a fair assessment of what a local authority needs to spend to provide a reasonable level of service. The "other services" block of the SSA for Westminster assumes that the cost of those services will be six times the cost of the same services in Havering, and three and a half times the cost in Croydon.
The Chartered Institute of Public Finance and Accountancy statistics show that Westminster's actual expenditure on "other services" was twice, not six times, that of Havering and twice, not three and a half times, that of Croydon. I put it to the House that the difference between Westminster's SSA for "other services" and its actual expenditure represents a gift to the poll tax payers of Westminster of £301.17 each. If such a gift were given to the poll tax payers of the London borough of Greenwich we might have a negative poll tax. Or if the safety nets were removed we would have a poll tax of no more than half the current amount.
Ministers have argued consistently that Greenwich is not an inner-London borough with inner-London characteristics but an outer-London borough with outer-London characteristics. I say again to the House that that is based on misleading, outdated information. All the current information contradicts that argument. Ministers also suggest that the council is extravagant and top heavy. Yet in his recent management letter the district auditor said that only four London authorities had a lower ratio of central support staff to total staff.
Greenwich's problem is the basic inadequacy and unfairness of the SSAs. Will the Minister explain one thing to the House? There are various principles on which the


capping regime may be brought into play. I understand that if the SSA of the London borough of Greenwich was only £1.87 million higher—far less than many of us believe that it should be—the expenditure limit would be £4.1 million higher. I ask the Minister to explain that and, if he can do so, to justify it to the House and the poll tax payers of Greenwich.
The social factors on which the SSA for Greenwich is based assume that Greenwich is a borough which is not in particular need and has outer-London characteristics. The Woolwich Arsenal ward of my constituency has the highest level of unemployment in London. I represent a constituency and borough in which the three wards around the town centre are among the 10 most deprived wards in London. Yet we have a significantly lower SSA than that of boroughs such as Wandsworth.
Let us compare the social needs in Wandsworth and Greenwich. The homelessness figures for 1990 show that in Greenwich 16.4 people per thousand population are homeless. In Wandsworth the figure is 13.9. The level of residence-based unemployment is higher in Greenwich than in Wandsworth. The number of long-term claimants in Greenwich is higher than that in Wandsworth. The number of 18 to 24-year-old claimants is higher in Greenwich than in Wandsworth.
The average earnings survey was mentioned. It is relevant when determining the social needs of the boroughs and areas that we represent. According to the new earnings survey, average earnings in Greenwich are £78 per week lower than the Greater London average. The percentage of employees earning less than £200 a week is higher in Greenwich than in Wandsworth, as is the percentage of employees earning less than £270 per week. Yet the difference between the standard spending assessments of Greenwich and Wandsworth is enormous. I shall focus on children's services, where we find the greatest disparity between the Government's assessment of the amount that Greenwich needs to spend and its expenditure. Greenwich spends £22 million on children's social services, which is 50 per cent. above its SSA. I believe that that is the largest gap between SSA and actual spend of any authority.
I shall again compare Greenwich and Wandsworth. The Government's SSA for children at risk in Greenwich is £253, and it is £332 for Wandsworth. The social index figure for children in Greenwich is £39 and is £209 for Wandsworth. The Government work on the basis that Greenwich has the lowest assessment for children at risk of any inner-London borough. The reality of the figures shows that Greenwich has the highest infant mortality rate in inner London; it has the second highest figure for placement of safety orders; it has the third highest number of children on the child protection register and, it has the fourth highest number of under-fives in care.
I know that Ministers have sometimes said that Greenwich could set a lower poll tax if it spent at the same level as its neighbouring authorities. That may be true if we consider such neighbouring authorities as Bexley. If one asked the right hon. Member for Old Bexley and Sidcup (Sir E. Heath) How many day nurseries are provided for the under-fives in his constituency by the London borough of Bexley, the answer would be, "None." if one asked the hon. Member for Bexleyheath (Mr. Townsend) how many

were provided in his constituency, the answer would be, "None." If one asked the hon. Member for Erith and Crayford (Mr. Evennett) the same question, the answer would be, "One." One day nursery for the entire borough of Bexley.
In Greenwich we do not believe that that is an adequate level of provision for our under-fives. I was struck by the statement yesterday by the Under-Secretary of State for Education. He claimed credit for provision for under-fives and said that that was important in terms not only of nursery education but of the Government's record in providing day care for the under-fives. That day care is provided by Labour local authorities in areas of acute social need, such as Greenwich—[HON. MEMBERS: "Come on.''] It is all very well for Conservative Members to say that.
When the Minister sums up, will he explain the disparity between the SSA for Greenwich and its expenditure? Will he tell the House how Greenwich can bridge that gap? It could not be done without decimating social services, where the largest gap occurs.
There is also a disparity between the treatment of Greenwich and Wandsworth as regards education. When the Government produced figures for relative grants to local authorities they said that Greenwich received £690 per adult for education, whereas Wandsworth received £536, as if we were being treated better in Greenwich than those in Wandsworth. Those were the cash figures per adult, but Greenwich has the highest school-age population of any inner London borough. For the record, I shall give the figures if we take the children into account: for primary schools, £2,377 in Greenwich and £2,562 in Wandsworth; and in secondary education, £3,480 in Greenwich and £3,756 in Wandsworth. Those are the real figures, which have an impact upon the service level which the local authority is able to provide.
On 14 May, on the BBC "Nine O'Clock News", the Secretary of State for the Environment said:
It's very difficult to get a formula that pleases everyone".
I agree with him, and I also agree with the leader of the Conservative group on Greenwich borough council, Councillor Peter King. Of the SSA formula, he said:
It treats some authorities badly, it treats Greenwich very badly. To some extent the SSA formula is mathematical modelling gone mad.
The SSA formula is inadequate for the distribution of grants, and it is ludicrous for determining the expenditure of local authorities.

Mr. Roy Thomason: I shall be brief as I know that many other hon. Members wish to speak.
As the former chairman of the Association of District Councils, it is natural that I should believe in the independence of local government. Within the functions delegated to it, it should be free to settle policies and to execute them. As I understand it, that is the principle of subsidiarity on which we talk so much in other debates. It means the delegation of decisions to the levels closest to those affected by those decisions, so far as that is practicable..
A second and more important principle determines that local government must act within the parameters set by the Government acting through Parliament. Sovereignty rests here as the democratic institution of the nation as a whole, including its Executive. We allow treaties to be made on


our behalf relating to European institutions. In that way, we pass some sovereignty to them. Likewise, we delegate functions to local government.
Local government has no divine right to govern its own communities. Its powers stem entirely from the Government acting through Parliament who must determine the national interest. One such item of national interest that must be determined is the levels of public expenditure. Local government is responsible for the expenditure of £60 billion per annum. The effect of that on inflation, the rates of interest and other levels of economic policy can never be ignored by any Government of any political colour. How can some Opposition Members object to monetary control passing to Europe and, at the same time, support it being passed to town halls? The truth is that sovereignty must always be vested in and controlled by the elected body of the nation as a whole.
Capping is based on SSAs and criticisms of them are bound to be made—hon. Members have advanced such powerful cases today. However, I can remember criticisms being levelled at the grant distribution formula of the past generation—grant-related expenditure. The way in which it passed money to local government was absolutely horrific. We all rightly complained about it. That system depended on 64 different formulae, but the present grant distribution mechanism is based on six principal formulae. It is much simpler and, therefore, much easier to understand.
Hon. Members are right to say that we must be balanced between simplicity and equity.

Dr. Lynne Jones: If the system is so simple, can the hon. Gentleman explain why, in Birmingham, the SSA for capital financing is £60 million when actual expenditure, which is based on historical spending, is £165 million? Where is the sense in that?

Mr. Thomason: The answer is that, historically, Birmingham city council has chosen to spend large sums of capital moneys. That decision was made by the democratically elected councillors of Birmingham and I defend their right to do it. Equally, they must accept the constraints imposed upon them by Government, which are in the interests of the nation as a whole.
I have heard the arguments of my hon. Friends who represent constituencies in Warwickshire and Hillingdon —my hon. Friends, the Members for Stratford-on-Avon (Mr. Howarth), for Uxbridge (Mr. Shersby) and for Hayes and Harlington (Mr. Dicks). They were right to raise their concerns, but the expenditure—and this has been accepted by Labour Members—by which those authorities exceed their cap limit is very small. Opposition Members say that, if it is so small, we should not bother about it at all. If it is less than £1 million—a tiny part of Hillingdon's budget of £167 million, or Warwickshire's budget of £299 million —why bother about it at all? We must bother about limits because they must be set at some point. We need them to deal with councils like Lambeth, which was represented in the debate earlier by the hon. Member for Norwood (Mr. Fraser), who is no longer in his place. He was arguing strongly for substantial additional expenditure in Lambeth and saying that we should write off that authority's past inability to collect the community charge. That would invite non-payment and is an extraodinary position to take.
The House must acknowledge that some 6.5 million payers of community charge pay an average of £99 per annum less than they would have done if capping had not been introduced. There is a need to impose national criteria because, unfortunately, some people in local government are prepared to act irresponsibly. It is sad that it is necessary, but we require it.
Although appeals have been successfully made by Basildon, Gloucestershire and Warwickshire, limits still need to be imposed on authorities to retain that control and ensure that some of the wild men and women representing local government—I am glad to say that they are very few—are not given the opportunity of throwing the national economy off course.
I support the proposals.

Mr. Nick Raynsford: I enjoy the opportunity of speaking after the hon. Member for Bromsgrove (Mr. Thomason), who has at least given some relief to the Government. His speech was out of keeping with all the previous contributions by hon. Members directly involved in local authorities that have been subject to capping, who have seen the unfairness and unsatisfactory nature of the process. We have heard a litany of complaints from hon. Members far better placed, because of their knowledge of local factors, to see how badly that system operates. The complaints span the political spectrum and, sadly, they have met with a stony-faced response from Ministers.
Those of us who represent the London borough of Greenwich have three principal reasons for believing that the Government's approach is wrong. First, the clear evidence of need in the area has been spelt out eloquently by my hon. Friend the Member for Woolwich (Mr. Austin-Walker), so I need not repeat it. Those needs are not being adequately met because the authority's expenditure has been capped repeatedly in recent years, forcing a series of cuts in its budget. The Minister talked glibly about dire warnings of cuts that had not been borne out in reality. Clearly he is far removed from what is actually happening. In Greenwich in recent years there have been forced closures of two day centres for the handicapped and two holiday hotels for the elderly, which were hugely popular and about which I have received many complaints from elderly people who enjoyed their holidays in them and no longer have that facility. Seven lunch clubs, three day clubs for the elderly, two day centres for the handicapped, three day nurseries, three branch libraries and two swimming pools have also been closed. Those are just some of the services that have had to be cut as a consequence of the Government believing that they know best and imposing cuts from the centre against the wishes of local electorates and democratically elected local councils.
The second complaint is over the unfairness of the standard spending assessment formula. Again, my hon. Friend the Member for Woolwich spelt that out, as did the hon. Member for Eltham (Mr. Bottomley) in an earlier intervention. It is significant that, across the political divide, hon. Members representing the borough of Greenwich all believe that the SSA formula is unfair and adversely affects the borough. I shall not go into detail, but I shall give two specific illustrations. In the social services, the children element is grotesquely inappropriate for an


authority with a high incidence of need that is reflected in a variety of ways. The standard spending assessment allows just £39 per child on the children needs index, compared with that of Lewisham—the next lowest placed inner London borough—which has £155 per child. The borough of Wandsworth has £208 per child and Westminster has £252.
It is significant that if Greenwich children's social index was raised to the level of the next lowest inner London borough, Lewisham, the SSA in Greenwich would be increased by £6.7 million—an amount close to the effect of the cap in reducing the budget that the council now proposes.
The second illustration is in respect of education. I have had a series of meetings with head teachers and parents who are deeply concerned about the impact of budget cuts on the quality of education and schooling in Greenwich. The formula penalises an authority that has a significantly rising school roll at both primary and secondary levels. The Greenwich school population is rising by about 4 per cent. per annum.
The formula is based on the school rolls in January of the preceding financial year and fails to take account of the impact of recent increases. If the formula were based on current school rolls in Greenwich rather than the previous date, the result would be to increase the SSA in Greenwich by £7.4 million—an amount almost in line with the difference between the capping figure and the authority's own budget.
If only one of those two factors were accepted, Greenwich would no longer be subject to capping and could agree and implement a budget, thus avoiding the devastating consequences of capping.
Our third complaint is specific to the issue of refugees. I raised the subject in an earlier intervention but did not receive an adequate response from the Minister, who I am glad to see has returned to the Chamber. A delegation from Greenwich came to see him last week and forcefully stressed the additional social service and education costs faced by the London borough of Greenwich and other authorities—whose representatives have been vociferous in today's debate—due to recent arrivals of significant numbers of refugees from many parts of the world. I am thinking particularly of refugees coming from Vietnam via Hong Kong, and from Somalia and Eritrea.
The costs that the authority has to incur are not reflected in the SSA. That point was put to the Minister, but he denied it. The Minister strongly assured the delegation that the SSA would reflect those additional costs. We challenged him and I have subsequently taken further advice from the Library. It is clear that the view that the Minister expressed to the delegation last week was wrong.
If the Minister advised the Secretary of State on a capping figure based on the advice that he gave us last week, he will have misled the Secretary of State and the Greenwich capping figure will have been wrongly calculated. Therefore, I invite him to reconsider the matter. The mistake is clear to me from the advice that I received from the Library, and from the advice that the Minister's officials have given to him and placed in the Library. The advice is as follows:
There is a time lag between the arrival of asylum seekers and their inclusion in the data on which SSAs are based.

I invite the Minister to recognise that he was wrong last week and the unfair formula will adversely affect Greenwich and other authorities with a significant number of recently arrived refugees. If he does not, he will have offered advice on the imposition of a cap based on erroneous information, which will be unjust to the people of Greenwich.
We see a sad and sorry picture of the imposition of centralised diktats by Ministers who cannot possibly understand the intricacies and detailed implications for local communities of what they are doing. They are imposing the diktats out of ideological conviction. However, as the hon. Member for Uxbridge (Mr. Shersby) said in his elegant speech, the Ministers do not apply the same logic to the Department's spending. Their actions are causing much hardship and misfortune in local communities. That is unjust and should be deeply regretted. I shall certainly vote against the order tonight.

Mrs. Teresa Gorman: The Opposition are a rum lot. The man in the street would characterise their attitude to public spending as, "Give 'em the money", because Labour always behaves as if money grows on trees and will appear on command. If Labour were asked to characterise my party's attitude to public spending it would say that we were like a Scotsman with his pockets sewn up. All that Labour can do is gripe when the Government announce a relaxation for some people in the community charge. That shows Labour's muddled attitude to public spending.
The Opposition have always made a muck of local government spending. I represent people who had the misfortune a short time ago to have their local affairs conducted by a Labour-controlled Basildon council. Year after year, they were subjected to massive increases in the community charge. Ours was one of the worst areas in the country, and last year compared with this we overspent by about 100 per cent. Our SSA was £22 million, but the council chose to spend £27 million and that could not be allowed to continue. Fortunately, the citizens of Billericay and Basildon saw through that and swept Labour from office. There was a 61 per cent. turnout and a massive swing of 15 seats. We wiped the floor with Labour.
The Conservative councillors are perfectly willing to conform to the Government's spending requirements in a full year, but by the time the new budget is in place the council will be six months behind a normal year's spending. When Labour was in control it set the budget for March, but we were not able to put our new budget into effect until July, and it cannot be implemented in time to make the savings that the Government rightly require in a full year. The new Basildon councillors are committed to that target and the Government, rightly and sensibly, have given us a respite to allow us to conduct the affairs of the council properly and to provide the necessary local services within a target that can be met by local people.
We are grateful to the Government for recognising the plight of Basildon's ratepayers. The cap will allow a reduction from the extremely high figure of £361—one of the worst in the country. It can be reduced by £41 and that will be gratefully received by the people in the area.
There have been adverse comments about the behaviour of the councillors who have taken over. Hon. Members have spoken about the notorious Towngate


theatre. It could have carried out its commitments and obligations until the end of July, but the committee running it chose to close it and cause some inconvenience. That was quite unnecessary. There was absolutely no need for the remarks by the hon. Member for Sheffield, Brightside (Mr. Blunkett). The hon. Gentleman chose not to say that the Billericay and Whitford parts of the constituency were deprived of such facilities for years because the Labour council running Basildon did not think it worth while to pander to the Conservative majority of voters in that part of my constituency. It deliberately deprived Conservative areas and we raised the necessary money to provide our own theatre and arts facilities. Labour councillors even deprived us of premises, but now they have got their come-uppance—and about time too.
An enormous debt has been inherited. Debt charges are £7 million, a third of the standard spending assessment. It is an enormous sum to have to find. It will take time to reduce the debt charges. The previous Labour council left our financial affairs in a dreadful mess. The Conservative party is now in office and it can examine what went on. It is clear that there is a great deal to do and a massive amount of waste to eradicate. If that is to be done humanely, we shall need more time to get ourselves on our feet.
The previous Labour council left us with seven mini-council area offices. They were completely unnecessary and merely duplicated work. In closing them, we have, unfortunately, to make redundancies, which must be funded. That is another great expense which the Conservative council has had to meet.
The Government have done the right thing by introducing a little relaxation to enable the council to get on its feet. They have done the right and proper thing by the council and, as I have said, it intends to meet the targets. Some extremely gratuitous remarks have been made about the splendid Conservative leader of the new council, Mr. Tony Archer. He is doing an excellent job. He has committed himself and the new Conservative council to maintain a high standard of public services and to provide them economically by applying Conservative standards and contracting out. He will adopt the principle of ensuring that every penny counts so that those who have to pay the community charge receive good services at a price that they can reasonably afford. In other words, there will be value for money.
I commend the Government for what they have done. They have made a splendid effort. My hon. Friend the Member for Basildon (Mr. Amess) and I are extremely grateful.

Mr. William O'Brien: The hon. Member for Billericay (Mrs. Gorman) must have been fast asleep during the debate. Of the six Conservative Back-Bench Members who have contributed to the debate, four denounced or criticised the Government for bringing forward the order. It seems that the hon. Lady does not recognise that sort of attitude.
It has been demonstrated by the House on more than one occasion that the poll tax is all wrong. It has been demonstrated again this evening that poll tax capping is all wrong. It is unfair and undemocratic and causes local authorities to cut services. When we were discussing the

Bill that introduced poll tax capping, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), who is now the Secretary of State for the Environment,
said that capping
is not a measure to be used as a matter of course … it is important that there should be such a reserve power …to protect the charge payers … against extreme cases of extravagant and irresponsible local authorities."—[Official Report, 25 April, 1988; Vol. 132, c. 51.]
We have learnt this evening that if a local authority is spending £5 per head per year more than the Secretary of State feels that it should be spending, he will apply the capping mechanism. In Gloucester, expenditure is only £3 per head per year over the SSA, but the right hon. and learned Gentlemen is applying the capping procedure, notwithstanding that he said in 1988 that it was a "reserve power". That demonstrates the difference between the meaning of those words in 1988 and the application of the power in 1991 and now in 1992.
How misleading and hypocritical the Government are when they talk about accountability and the principle of giving freedom to people and allowing them to decide for themselves. On 5 March 1990 the former Secretary of State for the Environment, Nicholas Ridley, said:
Should a Government stop councils from overspending or should people who elect councils stop them? I think it should be the latter.
Nicholas Ridley was advocating freedom for individuals through the ballot box. How does freedom for people to decide the outcome of the work and efforts of local authorities feature in the Prime Minister's citizens charter? How can the Minister say that Nicholas Ridley was wrong in March 1990?
Hon. Members with Warwickshire constituencies have said, both in their speeches and in interventions during the debate, that no one in Warwickshire has said that he is in favour of his local authority being capped. Where is the freedom for the people of Warwickshire to decide what the level of expenditure should be in their local authority area?
When the hon. Member for Bromsgrove (Mr. Thomason) was the Conservative leader of the Association of District Councils he expressed shock at the decision to apply the capping procedure to small district councils. He said:
I am shocked that the Government should so attack many of its own supporters in local government, particularly district councils which have raided their balances to keep charge levels down this year and maintained services. It is also shocking that the Environment Secretary should completely ignore all the assurances previous Ministers gave when the capping provisions were introduced that low spending authorities would be excluded from the controls.
What a somersault the hon. Member for Bromsgrove has done since he became a Member of Parliament. How many people would have thought 12 months ago, when the leader of the ADC, who is now the hon. Member for Bromsgrove, expressed shock at the Secretary of State's decision to introduce capping for district councils that he would now be saying that capping is a good thing for district councils?

Mr. Thomason: Will the hon. Gentleman give way?

Mr. O'Brien: When I have finished, I shall certainly give way.
How can the hon. Gentleman turn his back on the colleagues he left behind at Chapter street? He said then that they had to oppose the capping procedures. Does he not feel that the people in Chapter street are entitled to his


support? Are not those who work in local government just as much entitled to his support now as they were when he was the leader of the ADC?

Mr. Thomason: My constituents are entitled to my support and they expect value for money in local government services. I have not changed my position over the independence of local government, but I take the view that it may be necessary to introduce capping for those authorities that are prepared to spend and spend again. Fortunately, there are few district councils that are prepared to do that. Most of them are extremely careful. My position remains the same.

Mr. O'Brien: At the time that the hon. Member for Bromsgrove expressed shock he was representing people who had elected him through the ballot box, just as he is now representing people as a Member of Parliament. The only change is that now that he has left the local authority scene and come to Parliament he has changed his mind. That is a measure of the lead that has been given by the former leader of the ADC.
When we discussed this legislation on Report the hon. Member for Spelthorne (Mr. Wilshire) said:
That is why local authorities with small budgets are exempt from these clauses."—
the clauses referred to capping.
The real risks to local and national economies come from the huge spending authorities which spend vast sums rather than from the small ones."—[Official Report, 25 April 1988; Vol. 132, c. 41.]
When the hon. Gentleman intervened during the speech of my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) we found that he had changed his mind and done a complete somersault. He said that the small spending authorities were also a drain on national expenditure. That is another somersault committed by a Conservative hon. Member who now says something different from what he said when the legislation was introduced. However, I made it clear at the outset that of the six Conservative hon. Members who had spoken, four condemned the Government for capping certain authorities, and I am sure that local government appreciates such a stand.
The order is not targeted at high spending authorities and there is evidence, which has been mentioned several times this evening, which proves that. What is the position of the hon. Member for Spelthorne on the attack on low-spending authorities? Many local authorities have, under protest, accepted Government capping and have reduced their budgets accordingly. The record shows that Langbaurgh reduced its budget by £2 million, Middlesbrough reduced its budget by £1.4 million and my authority of Wakefield has made reductions of more than £4 million.
However, such cuts, which are the result of capping, often mean that the poorest sections of our community lose out disproportionately. Children, the disabled and the elderly are the people who suffer most as there have been increases in the charges for meals on wheels. The hon. Member for Stratford-on-Avon (Mr. Howarth) is not a Labour Member of Parliament but he expressed concern that people would suffer because of the increaseas in charges for meals on wheels as a result of poll tax capping. The home help service and many other services are being

cut, and the living standard and quality of life of the people on the lowest incomes have suffered dramatically as a direct result of poll tax capping. That was spelt out clearly by my hon. Friends the Members for Norwood (Mr. Fraser), and for Nuneaton (Mr. Olner) and the hon. Member for Cheltenham (Mr. Jones) who pointed out how cuts had affected the quality of life of people in their constituencies because of a reduction in services.
What hope is there for local authorities which face the 1990s with a reduction in resources, increasing demands for services, reduced flexibility, reactive budgeting and a worsening financial outlook, all brought about by capping? What future is there for local authorities facing such a scenario?
Since the draft capping order was published, three authorities have had their caps adjusted. The hon. Member for Billericay said how much her authority appreciated the reduction in its cap. Basildon's cap has been reduced by £1.95 million, Colchester's by £2.59 million and Warwickshire's by £4 million. We are not against authorities having their SSAs increased or their caps reduced but the question is, why does that apply only to those authorities?
Labour hon. Members asked that question, but it was also asked by the hon. Members for Stratford-on-Avon and for Gloucester (Mr. French). Labour hon. Members said that expenditure per adult, per schoolchild and per elderly person in their areas was identical to that of other authorities and yet their authorities were being capped because the Government had set the level of expenditure for those services at a lower level than was necessary in their communities. What hope is there for local authorities under a Conservative Government who attack them?
Of a total of 650 Members of Parliament, 266—or 40 per cent.—are former members of local authorities. One hundred and fifty one members of the Opposition and 111 Conservative hon. Members have all had experience of local government. All those 266 Members know the evil and devastation brought about by poll tax capping orders. [HON. MEMBERS: "No."] Conservative Members are afraid as, because of their experience in local government, they know that if they spoke honestly and fairly about poll tax capping they would say that it is a devastating way of reducing services to local people.
Former Labour councillors, many of whom have described the unfair and undemocratic way in which poll tax affects the provision of services by local authorities, will vote against the order. There is no doubt that those 151 Members who have served in local government will vote against the order, as will their right hon. and hon. Friends. But what I would like to see, and what people outside the House would like to see, is the 111 Tory MPs who have served in local government joining the Opposition and voting against the order. What the people of the Association of District Councils and the Association of County Councils would like to see is some solidarity from their Conservative colleagues in the Lobby tonight, and a vote against the order. Conservative hon. Members' experience, like ours, must weigh in favour of our colleagues—those councillors on whom Conservative Members appear to be turning their backs tonight. That must weigh on their consciences, as it would on ours.
We are trying to save local government; we are trying to make it work. The Minister says that he is in favour of local government, but he should demonstrate that from time to time by supporting it. I appeal to all hon. Members


who have served in local government to take the opportunity to defend it, and to give the people who work and serve in it a chance to continue what we fought to do —to improve services. If hon. Members want to protect local government services, the only way to do so is o vote with the Labour party against the capping order.

The Parliamentary Under-Secretary of State for the Environment (Mr. Robin Squire): This has been an interesting debate, which has rightly commanded interest on both sides of the House. As usual on such annual occasions, most hon. Members who have spoken are from authorities which have been capped, whether the caps have been reduced or not. I especially welcomed the contribution of my hon. Friend the Member for Bromsgrove (Mr. Thomason), who drew on his wide experience in local government.
Many points have been raised by individual Members, and before I deal with as many of them as time allows I shall reiterate some key points about this year's capping. I may not be able to deal with all the matters raised, but, if I do not, I undertake to write to hon. Members in response to their points.
This year, as for 1991–92, we announced our intentions for the capping criteria well in advance. The capping principles that we adopted in May gave effect to those provisional criteria, with the addition of a de minimis proviso.
The success of our capping strategy has been clearly demonstrated; only 10 authorities exceeded the capping principles, and local authority budgets overall came within about 1 per cent. of the amount provided for in the revenue support grant settlement.
Of course, as my hon. Friend the Minister of State said at the beginning of the debate, we should prefer not to have capped any authority, but not to have designated the authorities in question would have been to fail to face up to our responsibilities for the economy as a whole, and for protecting local charge payers from the effects of excessive budgeting—

Mr. Mike O'Brien: rose—

Mr. Squire: Time is very tight, so I shall see how I go before giving way. I had less than 15 minutes to speak. As the House knows, I usually give way, but I am under great pressure of time.
I shall deal briefly with the contributions from both Opposition Front-Bench spokesmen—the hon. Members for Sheffield, Brightside (Mr. Blunkett) and for Normanton (Mr. O'Brien). We heard the same record; they still refuse to recognise any responsibility for controlling local authority expenditure under any circumstances—although during the general election campagin they said that they would cap regional assemblies. It does not add up—but then we know that things do not add up when we are talking about the Labour party.
Again we have heard the great ode to Wandsworth and Westminister. Let me list the standard spending assessments for some other councils in inner London. I shall not give many examples; I shall give just enough to provide the flavour. In Hackney, the standard spending assessment is £2,117 per adult; in Tower Hamlets, it is £2,048; in Islington, it is £1,722; and in Lambeth, it is

£1,667. It is necessary to continue for some time before we reach Wandsworth's SSA, which is £1,388 per adult. Opposition Members imply that, if they were in government, they would not seek to measure need in their distribution of grant. I will pay them the tribute of saying that I do not believe them, but that is the logic of their position.
The hon. Member for Brightside said that the amounts involved were small—£3 or £5. Let me stress that capping does not exist solely to protect charge payers, although that is certainly its key aim. It exists to safeguard our national economic strategy. The sums with which we are dealing amount to £33.5 million: that may be nothing to Labour, but we consider it a significant figure.
My hon. Friend the Member for Gloucester (Mr. French) and the hon. Member for Cheltenham (Mr. Jones) made what they concede were similar points about boundary changes. I hope that the House will forgive me if I deal with the matter very carefully, for it is rather complex. In their challenges to the proposed caps, both Gloucester and Cheltenham argued that they should not have been capped in the first place, and that they had been caught by the capping criteria only because of a technicality
The increased population costs did not show up as part of Gloucester's or Cheltenham's demand on charge payers for 1991–92. Both councils have argued that we should have taken that into account in measuring the difference between their 1991–92 and 1992–93 budgets for capping purposes. In other words, they argued that the true increase in their budgeted spending was less than the simple difference between this year's and last year's overall budget figures, and that they should therefore have escaped capping.
Both councils received a large increase in their standard spending assessments in 1992.93 to reflect the boundary changes. Neither my hon. Friend the Member for Gloucester nor the hon. Member for Cheltenham disputes that; it is common ground between us. If the councils had budgeted in 1991.92 at or below their SSAs, they could have increased their budgets this year by the full amount of the increase in SSAs; but both councils budgeted above SSA in 1991.92, and that was before the boundary change. They are now saying, in effect, that they should be able to continue to spend above SSA, notwithstanding the large increases that they have received. Cheltenham has increased its budget by 16.6 per cent., leaving it 9 per cent. above SSA; Gloucester's budget has increased by 12 per cent., to 2.4 per cent. above SSA.
Only yesterday, my hon. Friend the Member for Gloucester wrote to me asking me to think again about the treatment of Gloucester city council. I am sure that he will forgive me if I briefly summarise the terms of the reply that he received. The Government carefully considered all the points made by both Gloucester and Cheltenham councils in support of their challenges, and all other relevant matters, in reaching a decision. We fully understand the councils' arguments about the effect of their boundary change on their base budgets for capping purposes. The councils say that they misunderstood our intentions. I am sorry if that is so, but I do not believe that they had grounds for assuming that their base budget for capping purposes would be adjusted in the way that they were advocating.
The then Secretary of State for the Environment, my right hon. Friend the President of the Board of Trade,


announced his provisional capping criteria to the House on 26 November 1991. Subsequently, Ministers told the House on two separate occasions—my right hon. Friend the President of the Board of Trade on 23 January and my right hon. Friend the Chief Secretary to the Treasury, then the Minister for Local Government and Inner Cities, on 12 March—that it remained the Government's intention that the provisional criteria should be the criteria that they would adopt to select authorities for capping in 1992–93.
The Government considered that, in all circumstances, a specific additional allowance in the capping criteria for the effect of the boundary changes—over and above the full reflection of the changes in the 1992–93 SSAs—was not appropriate.
Let me deal now with the question of asylum seekers, which was raised by the hon. Member for Greenwich (Mr. Raynsford) and my hon. Friends the Members for Uxbridge (Mr. Shersby) and for Hayes and Harlington (Mr. Dicks). My colleagues from Hillingdon have raised the matter before. Hillingdon argues that we should make a special allowance for that cost, which is estimated at around £1 million.
We considered the council's arguments on that point —and, indeed, all its other arguments—very carefully, and decided that, in all Hillingdon's circumstances, a relaxation in the proposed cap was not appropriate.
An authority's standard spending assessment is an objective measure, based on a large number of indicators, of what it is appropriate for that authority to spend in the light of its own particular circumstances. Within the SSA, there is an allowance for the cost of services, such as education and social services, that authorities have to provide to children in their area. I cannot, of course, say that the cost of looking after every child arriving in Hillingdon is taken individually into account in calculating the authority's SSA. That would be impossible in a formula-based assessment. But the SSA does, I believe, give a fair overall assessment of an appropriate level of spending in Hillingdon given the characteristics of the area. Moreover, my hon. Friends will have heard my hon. Friend the Minister of State give an undertaking, which I now repeat, to look again at any representations made by hon. Members and at their suggestions for improving or changing the standard spending assessment.
I shall give Warwickshire Members a detailed answer at a later date, as I am afraid I do not have time to do so now. Instead, let me summarise the position. I understand from my long-term hon. Friend the Member for Stratford-onAvon (Mr. Howarth) and from the hon. Member for Nuneaton (Mr. Olner) that they remain unhappy about the SSA in Warwickshire. I must point out that, compared with similar neighbouring authorities, Warwickshire does not do as badly as hon. Members may think. At £782, its standard spending assessment per head is of the same order of magnitude as those of Hereford and Worcester, at £785, and Avon, at £798.
To the hon. Members for Greenwich (Mr. Raynsford) and for Woolwich (Mr. Austin-Walker), I would simply say that Greenwich has a history of overspending. It has been capped in every year since capping started in 1985. That is a record. For yet another year, the Government are obliged to step in to protect charge payers in Greenwich from the financial consequences of their council's actions.

In the past two years, capping has knocked a total of £74 off the charges set by the council. This year's cap will reduce charges by £56. I am sure that, notwithstanding hon. Members' comments, the vast majority of people in Greenwich are only too grateful for capping.

Mr. Raynsford: Will the Minister give way?

Mr. Squire: I have undertaken to write to hon. Members on points that I cannot cover in the time available.
I turn, with some relief, to Basildon. My hon. Friend the Member for Billericay (Mrs. Gorman) distinguished herself in the debate by welcoming the action taken by the Government. We have listened carefully to everything that Basildon has said in its challenge.

Mr. David Amess: Is my hon. Friend aware that, according to local press reports, the hon. Members for Sheffield, Brightside (Mr. Blunkett) and for Dagenham (Mr. Gould) will be in my constituency at the weekend leading a demonstration which will be supported by Militant Tendency? Does my hon. Friend share my disappointment at my not being able to express the views of my constituents in the debate tonight?

Mr. Squire: rose—

It being three hours after commencement of proceedings on the motion, MADAM SPEAKER put the Question, pursuant to Order [19 June]:|

The House divided: Ayes 312, Noes 254.

Division No. 41]
[9.59 pm


AYES


Adley, Robert
Bruce, Ian (S Dorset)


Ainsworth, Peter (East Surrey)
Budgen, Nicholas


Aitken, Jonathan
Burns, Simon


Alexander, Richard
Burt, Alistair


Alison, Rt Hon Michael (Selby)
Butler, Peter


Allason, Rupert (Torbay)
Butterfill, John


Amess, David
Carlisle, John (Luton North)


Ancram, Michael
Carlisle, Kenneth (Lincoln)


Arbuthnot, James
Carrington, Matthew


Arnold, Jacques (Gravesham)
Carttiss, Michael


Arnold, Sir Thomas (Hazel Grv)
Cash, William


Ashby, David
Channon, Rt Hon Paul


Aspinwall, Jack
Chaplin, Mrs Judith


Atkins, Robert
Churchill, Mr


Atkinson, David (Bour'mouth E)
Clappison, James


Atkinson, Peter (Hexham)
Clark, Dr Michael (Rochford)


Baker, Rt Hon K. (Mole Valley)
Clarke, Rt Hon Kenneth (Ruclif)


Baker, Nicholas (Dorset North)
Clifton-Brown, Geoffrey


Baldry, Tony
Coe, Sebastian


Banks, Robert (Harrogate)
Colvin, Michael


Bates, Michael
Congdon, David


Batiste, Spencer
Conway, Derek


Bellingham, Henry
Coombs, Anthony (Wyre For'st)


Bendall, Vivian
Coombs, Simon (Swindon)


Beresford, Sir Paul
Cope, Rt Hon Sir John


Biffen, Rt Hon John
Cormack, Patrick


Blackburn, Dr John G.
Couchman, James


Bonsor, Sir Nicholas
Cran, James


Booth, Hartley
Currie, Mrs Edwina (S D'by'ire)


Boswell, Tim
Curry, David (Skipton & Ripon)


Bottomley, Peter (Eltham)
Davies, Quentin (Stamford)


Bottomley, Rt Hon Virginia
Davis, David (Boothferry)


Bowden, Andrew
Day, Stephen


Bowis, John
Deva, Nirj Joseph


Boyson, Rt Hon Sir Rhodes
Devlin, Tim


Brandreth, Gyles
Dickens, Geoffrey


Brazier, Julian
Dorrell, Stephen


Bright, Graham
Douglas-Hamilton, Lord James


Brooke, Rt Hon Peter
Dover, Den


Brown, M. (Brigg & Cl'thorpes)
Duncan, Alan


Browning, Mrs. Angela
Duncan-Smith, Iain






Dunn, Bob
Kirkhope, Timothy


Durant, Sir Anthony
Knapman, Roger


Dykes, Hugh
Knight, Mrs Angela (Erewash)


Eggar, Tim
Knight, Greg (Derby N)


Elletson, Harold
Knight, Dame Jill (Bir'm E'st'n)


Emery, Sir Peter
Knox, David


Evans, David (Welwyn Hatfield)
Kynoch, George (Kincardine)


Evans, Jonathan (Brecon)
Lait, Mrs Jacqui


Evans, Nigel (Ribble Valley)
Lamont, Rt Hon Norman


Evans, Roger (Monmouth)
Lawrence, Sir Ivan


Evennett, David
Legg, Barry


Faber, David
Leigh, Edward


Fabricant, Michael
Lennox-Boyd, Hon Mark


Fairbairn, Sir Nicholas
Lester, Jim (Broxtowe)


Fenner, Dame Peggy
Lidington, David


Field, Barry (Isle of Wight)
Lightbown, David


Fishburn, John Dudley
Lilley, Rt Hon Peter


Forman, Nigel
Lloyd, Peter (Fareham)


Forsyth, Michael (Stirling)
Lord, Michael


Forth, Eric
Luff, Peter


Fowler, Rt Hon Sir Norman
Lyell, Rt Hon Sir Nicholas


Fox, Dr Liam (Woodspring)
MacGregor, Rt Hon John


Fox, Sir Marcus (Shipley)
MacKay, Andrew


Freeman, Roger
Maclean, David


Gale, Roger
McLoughlin, Patrick


Gallie. Phil
McNair-Wilson, Sir Patrick


Gardiner, Sir George
Madel, David


Garel-Jones, Rt Hon Tristan
Maitland, Lady Olga


Garnier, Edward
Major, Rt Hon John


Gill, Christopher
Malone, Gerald


Gillan, Ms Cheryl
Mans, Keith


Goodson-Wickes, Dr Charles
Marland, Paul


Gorman, Mrs Teresa
Marlow, Tony


Gorst, John
Marshall, John (Hendon S)


Grant, Sir Anthony (Cambs SW)
Marshall, Sir Michael (Arundel)


Greenway, Harry (Ealing N)
Martin, David (Portsmouth S)


Greenway, John (Ryedale)
Mates, Michael


Griffiths, Peter (Portsmouth, N)
Mawhinney, Dr Brian


Grylls, Sir Michael
Mayhew, Rt Hon Sir Patrick


Gummer, Rt Hon John Selwyn
Mellor, Rt Hon David


Hague, William
Merchant, Piers


Hamilton, Rt Hon Archie
Milligan, Stephen


Hamilton, Neil (Tatton)
Mills, lain


Hampson, Dr Keith
Mitchell, Andrew (Gedling)


Hannam, Sir John
Mitchell, Sir David (Hants NW)


Hargreaves, Andrew
Moate, Roger


Harris, David
Monro, Sir Hector


Haselhurst, Alan
Montgomery, Sir Fergus


Hawkins, Nicholas
Moss, Malcolm


Hawksley, Warren
Needham, Richard


Heald, Oliver
Nelson, Anthony


Heathcoat-Amory, David
Neubert, Sir Michael


Hendry, Charles
Newton, Rt Hon Tony


Heseltine, Rt Hon Michael
Nicholson, David (Taunton)


Hicks, Robert
Nicholson, Emma (Devon West)


Higgins, Rt Hon Terence L.
Norris, Steve


Hill, James (Southampton Test)
Onslow, Rt Hon Cranley


Hogg, Rt Hon Douglas (G'tham)
Oppenheim, Phillip


Horam, John
Ottaway, Richard


Hordern, Sir Peter
Page, Richard


Howard, Rt Hon Michael
Paice, James


Howarth, Alan (Strat'rd-on-A)
Patten, Rt Hon John


Howell, Rt Hon David (G'dford)
Pattie, Rt Hon Sir Geoffrey


Hughes Robert G. (Harrow W)
Pawsey, James


Hunt, Rt Hon David (Wirral W)
Peacock, Mrs Elizabeth


Hunt, Sir John (Ravensbourne)
Pickles, Eric


Hunter, Andrew
Porter, Barry (Wirral S)


Hurd, Rt Hon Douglas
Porter, David (Waveney)


Jack, Michael
Portillo, Rt Hon Michael


Jackson, Robert (Wantage)
Powell, William (Corby)


Jenkin, Bernard
Rathbone, Tim


Jessel, Toby
Redwood, John


Johnson Smith, Sir Geoffrey
Renton, Rt Hon Tim


Jones, Gwilym (Cardiff N)
Richards, Rod


Jones, Robert B. (W H'f'rdshire)
Rifkind, Rt Hon. Malcolm


Jopling, Rt Hon Michael
Robathan, Andrew


Kellett-Bowman, Dame Elaine
Roberts, Rt Hon Sir Wyn


Key, Robert
Robertson, Raymond (Ab'd'n S)


Kilfedder, Sir James
Robinson, Mark (Somerton)


King, Rt Hon Tom
Roe, Mrs Marion (Broxbourne)





Ross, William (E Londonderry)
Thompson, Patrick (Norwich N)


Rowe, Andrew (Mid Kent)
Thornton, Sir Malcolm


Rumbold, Rt Hon Dame Angela
Thurnham, Peter


Ryder, Rt Hon Richard
Townend, John (Bridlington)


Sackville, Tom
Townsend, Cyril D. (Bexl'yh'th)


Sainsbury, Rt Hon Tim
Tracey, Richard


Shaw, David (Dover)
Tredinnick, David


Shaw, Sir Giles (Pudsey)
Trend, Michael


Shepherd, Colin (Hereford)
Trotter, Neville


Shepherd, Richard (Aldridge)
Twinn, Dr Ian


Sims, Roger
Vaughan, Sir Gerard


Skeet, Sir Trevor
Viggers, Peter


Smith, Sir Dudley (Warwick)
Waldegrave, Rt Hon William


Smith, Tim (Beaconsfield)
Walden, George


Soames, Nicholas
Waller, Gary


Spencer, Sir Derek
Ward, John


Spicer, Sir James (W Dorset)
Wardle, Charles (Bexhill)


Spicer, Michael (S Worcs)
Waterson, Nigel


Spink, Dr Robert
Watts, John


Spring, Richard
Wells, Bowen


Sproat, lain
Wheeler, Sir John


Squire, Robin (Hornchurch)
Whitney, Ray


Stanley, Rt Hon Sir John
Whittingdale, John


Steen, Anthony
Widdecombe, Ann


Stephen, Michael
Wiggin, Jerry


Stern, Michael
Willetts, David


Streeter, Gary
Wilshire, David


Sumberg, David
Winterton, Mrs Ann (Congleton)


Sweeney, Walter
Winterton, Nicholas (Macc'f'ld)


Sykes, John
Wolfson, Mark


Tapsell, Sir Peter
Wood, Timothy


Taylor, Ian (Esher)
Yeo, Tim


Taylor, Rt Hon D. (Strangford)
Young, Sir George (Acton)


Taylor, John M. (Solihull)



Taylor, Sir Teddy (Southend, E)
Tellers for the Ayes:


Temple-Morris, Peter
Mr. Irvine Patrick and Mr. Sydney Chapman.


Thomason, Roy



NOES


Abbott, Ms Diane
Carlile, Alexander (Montgomry)


Adams, Mrs Irene
Chisholm, Malcolm


Ainger, Nick
Clapham, Michael


Ainsworth, Robert (Cov'try NE)
Clark, Dr David (South Shields)


Allen, Graham
Clarke, Eric (Midlothian)


Alton, David
Clarke, Tom (Monklands W)


Anderson, Donald (Swansea E)
Clelland, David


Anderson, Ms Janet (Ros'dale)
Clwyd, Mrs Ann


Armstrong, Hilary
Coffey, Ms Ann


Ashdown, Rt Hon Paddy
Cohen, Harry


Ashton, Joe
Connarty, Michael


Austin-Walker, John
Cook, Frank (Stockton N)


Barnes, Harry
Cook, Robin (Livingston)


Battle, John
Corbyn, Jeremy


Bayley, Hugh
Corston, Ms Jean


Beckett, Margaret
Cousins, Jim


Beith, Rt Hon A. J.
Cox, Tom


Bell, Stuart
Cryer, Bob


Benn, Rt Hon Tony
Cummings, John


Bennett, Andrew F.
Cunliffe, Lawrence


Benton, Joe
Cunningham, Jim (Covy SE)


Bermingham, Gerald
Dafis, Cynog


Berry, Roger
Dalyell, Tam


Betts, Clive
Darling, Alistair


Blunkett, David
Davidson, Ian


Boateng, Paul
Davies, Bryan (Oldham C'tral)


Boyce, Jimmy
Davies, Rt Hon Denzil (Llanelli)


Boyes, Roland
Davies, Ron (Caerphilly)


Bradley, Keith
Davis, Terry (B'ham, H'dge H'I)


Bray, Dr Jeremy
Denham, John


Brown, Gordon (Dunfermline E)
Dewar, Donald


Brown, N. (N'c'tle upon Tyne E)
Dixon, Don


Burden, Richard
Dobson, Frank


Byers, Stephen
Dowd, Jim


Caborn, Richard
Dunnachie, Jimmy


Callaghan, Jim
Dunwoody, Mrs Gwyneth


Campbell, Ms Anne (C'bridge)
Eagle, Ms Angela


Campbell, Menzies (Fife NE)
Enright, Derek


Campbell, Ronald (Blyth V)
Etherington, William


Campbell-Savours, D. N.
Evans, John (St Helens N)


Cann, James
Ewing, Mrs Margaret






Fatchett, Derek
Jones, leuan (Ynys MÔn)


Field, Frank (Birkenhead)
Jones, Jon Owen (Cardiff C)


Fisher, Mark
Jones, Ms Lynne (B'ham S 0)


Flynn, Paul
Jones, Martyn (Clwyd, SW)


Foster, Derek (B'p Auckland)
Jones, Nigel (Cheltenham)


Foster, Donald (Bath)
Jowell, Ms Tessa


Foulkes, George
Kaufman, Rt Hon Gerald


Fraser, John
Kennedy, Charles (Ross, C & S)


Fyfe, Maria
Kennedy, Ms Jane (L'p'I Br'g'n)


Galloway, George
Khabra, Piara


Gapes, Michael
Kilfoyle, Peter


George, Bruce
Kirkwood, Archy


Gerrard, Neil
Leighton, Ron


Gilbert, Rt Hon Dr John
Lewis, Terry


Godman, Dr Norman A.
Litherland, Robert


Godsiff, Roger
Livingstone, Ken


Golding, Mrs Llin
Lloyd, Tony (Stretford)


Graham, Thomas
Loyden, Eddie


Grant, Bernie (Tottenham)
Lynne, Ms Liz


Griffiths, Nigel (Edinburgh S)
McAllion, John


Griffiths, Win (Bridgend)
McAvoy, Thomas


Grocott, Bruce
McCartney, Ian


Gunnell, John
MacDonald, Calum


Hain, Peter
McFall, John


Hall, Mike
Mackinlay, Andrew


Hanson, David
McLeish, Henry


Harman, Ms Harriet
McMaster, Gordon


Henderson, Doug
McNamara, Kevin


Heppell, John
McWilliam, John


Hill, Keith (Streatham)
Madden, Max


Hinchliffe, David
Mahon, Alice


Hoey, Kate
Mandelson, Peter


Hogg, Norman (Cumbernauld)
Marek, Dr John


Home Robertson, John
Marshall, David (Shettleston)


Hood, Jimmy
Marshall, Jim (Leicester, S)


Hoon, Geoff
Martin, Michael J. (Springburn)


Howarth, George (Knowsley N)
Martlew, Eric


Howells, Dr. Kim (Pontypridd)
Maxton, John


Hoyle, Doug
Meacher, Michael


Hughes, Kevin (Doncaster N)
Meale, Alan


Hughes, Robert (Aberdeen N)
Michael, Alun


Hutton, John
Michie, Bill (Sheffield Heeley)


Jackson, Ms Glenda (H'stead)
Michie, Mrs Ray (Argyll Bute)


Jackson, Ms Helen (Shef'ld, H)
Milburn, Alan


Jamieson, David
Miller, Andrew


Janner, Greville
Mitchell, Austin (Gt Grimsby)


Jones, Barry (Alyn and D'side)
Moonie, Dr Lewis





Morgan, Rhodri
Sheldon, Rt Hon Robert


Morley, Elliot
Shore, Rt Hon Peter


Morris, Rt Hon A. (Wy'nshawe)
Short, Clare


Morris, Estelle (B'ham Yardley)
Skinner, Dennis


Morris, Rt Hon J. (Aberavon)
Smith, Andrew (Oxford E)


Mudie, George
Smith, C. (Isl'ton S & F'sbury)


Mullin, Chris
Smith, Rt Hon John (M'kl'ds E)


Murphy, Paul
Smith, Llew (Blaenau Gwent)


Oakes, Rt Hon Gordon
Soley, Clive


O'Brien, Michael (N W'kshire)
Spearing, Nigel


O'Brien, William (Normanton)
Spellar, John


O'Hara, Edward
Squire, Rachel (Dunfermline W)


Olner, William
Steel, Rt Hon Sir David


Orme, Rt Hon Stanley
Steinberg, Gerry


Patchett, Terry
Stevenson, George


Pendry, Tom
Strang, Gavin


Pickthall, Colin
Straw, Jack


Pike, Peter L.
Taylor, Mrs Ann (Dewsbury)


Pope, Greg
Taylor, Matthew (Truro)


Powell, Ray (Ogmore)
Tipping, Paddy


Prentice, Ms Bridget (Lew'm E)
Tyler, Paul


Prentice, Gordon (Pendle)
Vaz, Keith


Prescott, John
Walker, Rt Hon Sir Harold


Primarolo, Dawn
Wallace, James


Purchase, Ken
Walley, Joan


Quin, Ms Joyce
Wardell, Gareth (Gower)


Radice, Giles
Wareing, Robert N


Randall, Stuart
Watson, Mike


Raynsford, Nick
Wicks, Malcolm


Redmond, Martin
Williams, Rt Hon Alan (Sw'n W)


Reid, Dr John
Williams, Alan W (Carmarthen)


Robertson, George (Hamilton)
Wilson, Brian


Roche, Ms Barbara
Winnick, David


Rooker, Jeff
Wise, Audrey


Rooney, Terry
Worthington, Tony


Ross, Ernie (Dundee W)
Wray, Jimmy


Rowlands, Ted
Wright, Tony


Ruddock, Joan



Salmond, Alex
Tellers for the Noes:


Sedgemore, Brian
Mr. Ken Eastham and Mr. Eric Illsley.


Sheerman, Barry

Question accordingly agreed to.

Resolved,
That the draft Charge Limitation (England) (Maximum Amounts) Order 1992, which was laid before this House on 22nd June, be approved.

Mentally Ill and Handicapped Prisoners

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Boswell.]

Mr. Tom Clarke: I first raised these matters on an Adjournment debate similarly entitled —[Interruption.]

Madam Speaker: Order. Would hon. Members leaving the Chamber do so quietly so that we can get on with our business?

Mr. Clarke: Thank you, Madam Speaker. I am sure that I shall be awarded injury time.
I am delighted to see that the Chancellor of the Exchequer and the Chancellor of the Duchy of Lancaster are present, as well as the Minister of State, Home Office, because the problems of mentally ill people in prison might be helped by their interest.
I first raised this matter in an Adjournment debate, similarly entitled "Mentally Handicapped and Mentally Ill Prisoners", on 16 July 1986. I should have liked to report that there has been more progress since then. However, as there has been no progress, there is need for this debate.
I had hoped for an Adjournment debate in February but, unfortunately, that was not possible. As the Minister knows, prior to that I had visited Brixton prison and saw some examples of dedication on the part of the staff, but also matters which I am sure will worry the House deeply and will help us to concentrate on the issues under discussion.
The governor of Brixton prison, Dr. Coyle, is extremely dedicated. Without dwelling on such important issues as F-wing and other aspects of psychiatric care, I thought it would be right to give a flavour of my visit by quoting a letter that the governor wrote to The Independent in response to some criticisms made last October, which I think were unreasonable. Two points in the governor's letter are well worth making. He said, first, in respect of his prison:
For many years, in excess of 1,000 prisoners have been crammed into some 700 cells … Among this number of prisoners about 300 on any one day require medical supervision of one form or another. The vast majority has been remanded for psychiatric reports. That is the equivalent of a medium-sized psychiatric hospital. It is important to remember that Brixton is not a psychiatric hospital.
Elsewhere in his letter Dr. Coyle wrote:
In the past 12 months there have been two deaths by suicide in Brixton Prison. These are two too many but they have to be seen in context and comparisons can usefully be made with the experience in psychiatric hospitals similar in size to the medical wing at Brixton. During the same period staff have successfully intervened to prevent 38 prisoners taking their lives. That indicates a level of care of which Brixton can be proud.
The governor was absolutely right. Sadly, many of the problems that he outlined are shared by other prisons and are worthy of our consideration.
The Minister will be aware of the Gunn report, which found that about one third of sample male prisoners and 59 per cent. of females were diagnosed as having some kind of psychiatric problem.
The review of health and social services for mentally disordered offenders and others requiring similar services, chaired by Dr. John Reed, also reported on various groups

and their needs. We know that every person in those circumstances is unique, and is entitled to an individual assessment and to understanding of his or her problems.
The Gunn report was published in 1990 and revised in 1991. The Minister will be aware of its contents. I found that one of the most distressing points made in the report was:
In some prison hospitals, it is possible to see an acutely psychotic patient locked in a cell for the whole day. He may be clad only in a canvas shirt with no possessions or furniture other than a mattress, possibly soaked in urine or soiled with excrement. Compulsory treatment can only be given in an emergency. Patients kept in such conditions in the health service would be the cause of public outcry and an inquiry. The situation is no more defensible when it occurs in prison.
I entirely agree.
Of the Gunn report, The Guardian said:
At least one in five sentenced prisoners is thought to have a mental disorder. A study funded by the Home Office and published in October put the incidence as high as 14,000 of the 38,000 sentenced prison population, with 1,100 so ill that they require immediate treatment.
That is extremely worrying to the medical staff who seek to serve such prisoners, to voluntary organisations, and to the families of those individuals.
In December 1991, the Health Service Journal reported at length on the problem. I do not wish to weary the House by quoting exactly from that article, but it was interesting that it appeared under the heading "Prisoners who know not what they have done". The fact that there are people in prison experiencing enormous difficulties, who often are unable to cope with the environment in which they find themselves and who do not know why they are there, tells us a lot. Surely there must be better ways of dealing with such persons. I hope that the Minister can reassure us that the Government and their various Departments are at least aware that such problems exist in many prisons and not just in Brixton.
My worry is that, as I understand it, there has been no policy statement that explicitly covers the care and treatment of those in need of mental health care who remain in prison. However, the Government have published one document, to which I hope to refer. I am concerned about strategy and about the Government's approach to reducing the numbers and to coping with those who are in prison. Of course, it is increasingly accepted that too many mentally disordered and disturbed offenders are in prison who should not be there. However, there is no clear strategy across relevant Government Departments to ensure that services are available, and no single Department has lead responsibility for the care of mentally disturbed offenders.
If, as I understand it, the Government's policy is to reduce the number of such people coming into the criminal justice system, may I ask what is being done to achieve that end? How are such people being taken out of the system? Are they being dealt with in accordance with a proper assessment of the difficulties that they face? If the debate achieves nothing other than to obtain a clear statement from the Minister on the Government's approach to those important issues, its importance will be confirmed.
In preparing for the debate, I received a number of letters and representations from voluntary organisations. Colin MacKay, of the Scottish Society for the Mentally Handicapped, wrote to me, saying:
There are no adequate alternatives to prison particularly for people with a mild or moderate handicap who persistently offend … The police have little training in mental handicap and may fail to recognise it, or not know what to do about it
There is a Scottish Office circular on interviewing mentally disordered suspects but it is a long way short of the more rigorous English Code of Practice under PACE (Police and Criminal Evidence Act).
Because of time constraints and the inadequacy of legal aid, defence lawyers may not pick up the fact that a person has a mental handicap.
Clearly we are dispensing with the law in that case, to the detriment of vulnerable people who face those difficulties. I know that the Minister does not have specific responsibility for Scotland, but Scotland has that problem. He may wish to take that on board and discuss it with his colleagues at the Scottish Office.
How firm have the Government been in emphasising the powers available to the courts and other relevant agencies to divert mentally disturbed offenders from the criminal justice system, not just in England and Wales but also in Scotland? We must deal with what is often described as the "revolving door syndrome". Organisations such as MIND frequently refer to the problem in that way. Many prisoners are likely to be serving short sentences for petty offences and will not be subject to any statutory supervision by the probation service on release. Many may also be homeless and rootless. The Minsiter will know what the Butler report had to say on that as long ago as 1975. Although I recognise that the Home Office and the Mental Health Foundation funded the three NACRO diversion projects to encourage changes in current arrangements, I wish to ask genuinely what progress the Home Office feels is being made on those important points.
The Minister will acknowledge that the Government have had the benefit of a number of reports, not simply the views of voluntary organisations, important though they are, like NACRO, MIND and the Scottish Society for the Mentally Handicapped, but also their own Her Majesty's Chief Inspector of Prisons' report from January 1990 to March 1991, which said:
It is our view that there is an urgent need for the Prison Service to review facilities for disabled and handicapped inmates, staff and visitors in all establishments.
That was a profound comment, and when it is made at that level the House is entitled to hear of the response from the Home Office and other Departments involved.
There is also the report of the Reed committee. The Minister may wish to deal with that, but also with the representations made to his Department by MENCAP, MIND, the Patients Association, and many others who realise the importance of the issues raised.
The British Medical Journal expressed concern about such reports and what it considered to be elements of Government inaction when it, too, wrote an article headed, "Mentally disordered prisoners: reports but no improvements".
There is a real worry that, because the Government do not like information, we seem to be failing to get the response that the problems in those prisons, and of individuals in prisons, invite. The enormous strain on the prison medical service is self-evident. The whole House would wish to congratulate those who deal with such difficult issues. In November 1991, the Home Office published a consultation paper on the reform of the prison medical service. What will follow? What are the Government doing, given that the consultation document was published? What do they feel about the responses that

they have received, and how much support are they giving to the prison medical service, which would be under enormous strain even if it were not for the problems of the large numbers of mentally ill or mentally handicapped persons who find themselves in prison?
The issues raised are particularly significant. We are concerned about the numbers of such people who find themselves in prison. We are also worried about the strain on, and demands made of, the staff, because clearly the management of such persons is out of all proportion to their numbers. I mentioned Brixton, but I think that suicide attempts occur elsewhere, which is why the rights of the individual have to be protected, and the Gunn report was based on the facts available to its author.
I shall put three specific questions to the Minister in the hope that, even if he cannot reply to them tonight, he will write to me with a considered response from the Home Office. According to The Independent on 1 June, £100 million is needed to support medical and nursing staff to meet the problems of mentally ill offenders. I do not know whether that figure is accurate, but I want to know whether the Government have made an assessment on resources and, if so, what conclusions they have reached.
Secondly, can the Minister tell us of the Home Office plans for pilot projects in the prison health service?
Thirdly, as we hear much about the privatisation of the prison service, and bearing in mind the vulnerable groups who are the subject of today's debate, it would not be unreasonable to ask whether the national health service will still be involved in the interests of such people. What are the Minister's thoughts on that matter, particularly in respect of mentally ill and mentally handicapped prisoners?
I thank the Minister for listening to my comments. Dr. Coyle, the governor of Brixton prison, said of the staff in prison who address the problems:
There is a comradeship in adversity".
I want that comradeship to continue, but the adversity should be reduced. Do the Government share those objectives?

The Minister of State, Home Office (Mr. Peter Lloyd): I congratulate the hon. Member for Monklands, West (Mr. Clarke) on his success in securing tonight's Adjournment debate to raise the important issue of mentally ill and mentally handicapped people in prison. Over the years he has demonstrated a sincere regard for the rights and circumstances of those who are mentally ill and mentally handicapped. His was a well-informed and thoughtful speech. I hope that what I say this evening in the time available will answer some of his worries and set out clearly our present practices and policies for the future. There will be some items that, in the time left me, I shall not be able to cover. I shall take up his request and write to him on those matters.
The issue of mentally disordered people in prison has recently rightly commanded much public and media attention. It is now widely understood that the imprisonment of a mentally disturbed offender can aggravate his or her mental disorder. It is the Government's policy that mentally disturbed offenders should receive care and treatment from the health and social services. They should be diverted from the criminal justice system at the earliest possible opportunity. The hon. Gentleman and I are agreed on that.
Mentally disordered people should he prosecuted, but only where that is required in the public interest. In other cases alternatives to prosecution should be found. To encourage that, the Government have issued guidance to the police, courts and the probation service, and are pursuing with the police ways of improving their working relationship with health and social services. Together with the Mental Health Foundation we have provided funding for three pilot projects organised by the National Association for the Care and Resettlement of Offenders to encourage the diversion of mentally disordered offenders from the criminal justice system. We are giving the foundation an annual grant of £250,000 to enable it to support diversion projects.
We are now also planning a series of regional conferences for senior managers and representatives of health and social services and the criminal justice agencies to help them to plan an improved response by their services to the needs of the mentally disordered who come before the courts. However, criminal offences are committed by people who suffer from mental disorder, and from time to time those people will inevitably find themselves before the courts. The courts should be guided by the provisions of the Mental Health Act 1983, which enables mentally disordered offenders to be directed away from prison.
To ensure that the provisions of that Act are fully understood and complied with, the Home Office issued detailed guidance in 1990. This drew to the attention of the courts and others the need to make greater use of their powers under the Mental Health Act. Those powers include the ability to remand a defendant to hospital for psychiatric reports. Persons remanded to prison or convicted prisoners may be transferred to hospital following medical reports that the individual concerned is suffering from mental disorder.
Furthermore, prison sentences for offenders who are mentally disordered at the time of their appearance in court may be avoided altogether if the court so decides, and the offender detained in hospital.
There has been a significant improvement in the number of prisoners transferred to hospital. During 1991, 470 prisoners were transferred under sections 47 and 48 of the Mental Health Act, compared with 325 in 1990 and 137 in 1986. This represents an increase over the past year of 45 per cent. and prison medical officers and Home Office officials are continuing their efforts to identify and transfer prisoners to hospital where appropriate. We expect to transfer at least 600 this year.
The policy is clear. Imprisonment is not appropriate for the mentally disordered. However, the Government are aware that, despite the improvements, there is still some way to go. There are still in our prisons some mentally disordered offenders who should be directed to hospital, and some who are mentally disordered but are not detainable under the Mental Health Act and cannot, therefore, be transferred to hospital solely because of that mental disorder. For this second group the commitment must be to provide adequate facilities and specialised care and support.
It was to assist us to establish the extent of this problem that we commissioned research from Professor John Gunn of the Institute of Psychiatry in 1988. This was one of the two reports to which the hon. Member for Monklands,

West referred. The report was published last year and a copy is in the Library. Clearly, the hon. Gentleman has read it with care.
The report commented on the existing facilities for the treatment of mental disorder in prison, and made recommendations for improvement. We are giving careful consideration to Professor Gunn's recommendations and are in the process of developing a strategy for the care of those prisoners with mental health needs for whom transfer to hospital is not appropriate. A joint Home Office and Department of Health review of health and social services for mentally disordered offenders and others requiring similar services was announced by my hon. Friend the then Under-Secretary of State for Health in November 1990. The hon. Gentleman also referred to that report.
The steering committee of the review met at the beginning of 1991 under the chairmanship of Dr. John Reed, senior principal medical officer at the Department of Health, and has since been referred to as the Reed committee. It has to date made good progress and is due to end next month when the steering committee will submit a final report to Ministers.
The review has published eight interim reports, together with an overview document. These are the reports of the prisons, hospital and community advisory groups which were issued to interested bodies for consultation in November of last year, and they have elicited some 200 responses from a range of agencies.
On 2 June reports of the advisory groups concerned with finance, staffing and training, research, academic development and services for mentally disordered offenders with special needs were issued for consultation purposes. The advisory groups have made 87 recommendations that are intended to improve the co-ordination and delivery of care and treatment for mentally disordered offenders. These provide guidance on the range and magnitude of health and social services provision that may be required, as well as the systems necessary to identify and assess the needs of those who should be diverted from the criminal justice system to more suitable treatment centres. Several of the recommendations for the mental health care of mentally disordered prisoners are entirely in accord with proposals that are set out in the White Paper on the prison service entitled "Custody, Care and Justice" and in the recent consultation paper on contracting for prison health services.
The reports underwrite the Government's policy that mentally disordered offenders who need care and treatment should receive it from the health and social services rather than from the criminal justice system. It is not our intention that action should be delayed merely because the review is still taking place. Indeed, we are at present considering, with colleagues in the Department of Health, the present recommendations with the aim of identifying those that can be implemented at an early date. One such is the provision of additional beds in regional secure units. A further £18 million has been allocated to the building programme. This should ensure the provision of an extra 400 medium secure beds by the end of 1994.
The recommendations contained in the reports provide an opportunity to make radical improvements to the way in which mentally disordered offenders are treated in our society. As the hon. Gentleman implied, they have considerable resource implications. The cost of a bed for such transfers from the prison system to a local hospital


could cost £30,000 to £40,000 a year. Transfer to a regional secure centre could cost upwards of £70,000 a year a bed. The cost of a bed in a special hospital would be similar. It is important that we get our plans right because they are certainly costly.
With the close co-operation that has been achieved between our Departments through the review I believe that we can develop a system whereby the mentally disordered should be cared for as far as possible in the community under conditions of no greater security than is justified and with the quality of care and attention that they require.
I intended to refer to several other matters but my time is limited. I shall deal, however, with the hon. Gentleman's question about the impact of the private management of prisons. I hope that in the end it will be small. I say that because I hope that we shall divert, before they get to prison, offenders who need treatment elsewhere. Should such offenders arrive in a prison, which will happen from time to time, the medical service in the prison—whether provided under contract by the national health service or by a private health provider—will operate in the same way

as the rest of the prison service. It will diagnose those who should not be in prison and they will then be moved out of the prison service into an NHS institution—it will be an NHS institution for the foreseeable future. There will be no difference in approach between the privately managed prision and the public sector prison.
The hon. Gentleman referred to Brixton when talking about the need to give appropriate treatment. He is aware that we have been developing an acute psychiatric unit in Brixton that will provide a high standard of medical and nursing care and an improved regime for acutely disturbed inmates for whom transfer to hospital is not immediately possible or perhaps not necessary. The building works are completed and arrangements are in hand to select personnel who are qualified to staff the unit. The unit will be brought into use once the staff are in post.
I shall write to the hon. Gentleman about the matters that I have not had time to cover. I am glad that he has given me the opportunity to put on record what I have this evening because he has raised an important subject.

Question put and agreed to.

Adjourned accordingly at sixteen minutes to Eleven o'clock.